The exact same point applies to Twitter's 3rdparty API getting killed off, and both moves are still a mystery.
It'd be easy to say "as a condition of getting this API key, you agree to display ad elements as they are served in the feed, and on click, open their associated URL in the system browser". All the ad-targeting is done server-side anyways, and attribution via unique links is easy.
They absolutely could make ads part of the API that third party applications have to display.
There's a hundred things they could do if you assume they care about third-party applications, and don't specifically want to kill them.
I do think they want to kill them, actively, but even beyond that it's really clear they don't care.