You'll notice that your options are slightly limited here. If you want to mute someone's story but would like to keep seeing that account's pictures in your feed, you'll have to go to their profile.
Similar to Facebook's "Unfollow" and Snapchat's "Do Not Disturb" features, you can still go to the account if you want to see their posts or story, even if the profile is private. You're still following each other; you just don't get updates on their activity.
And if you change your mind, you can always Unmute the account's posts and stories the exact same way.
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