While InstaMorph turns clear when it is at a suitable molding temperature, InstaMorph turns an opaque white when it cools. Still, when applied in a thin layer, it does allow some light to pass through it, making it a really great light diffuser for small LEDs.
In this example, Michelle over at YuKonstruct turn some soft, warm InstaMorph and wrapped around an LED throwie. The LED now casts a great diffused glow.