Comes from the word “instance.” An instance is a particular realization of some abstraction or template such as a class of objects or a computer process. To instantiate is to create such an instance by, for example, defining one particular variation of object within a class, giving it a name, and locating it in some physical place. In DAW parlance, instantiate has become the $3 word for enabling plug-ins within a session. For example, when you bring up a reverb in your session it is common to say you have instantiated your reverb plug-in.
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