This happened to me last year. I was horrified at what I found on my DDs (age 13/14) phone. Her online persona was so different to the way she was at home.
I took her phone away from her for a week or 2 while I totally buttoned down the security.
I now have all her pass codes and passwords, she isn't allowed to down load any apps that I don't approve of and I basically had a steep learning curve to become more savvy.
We talked at length about safety online and image and what her words, provocative images were conveying. She had made her accounts public (keeping them private was a condition of her being allowed social media) and as a consequence was being followed and messaged by many men.
Since then, I have checked her account very regularly, it has been a battle as she pushes the boundaries and I reserve the right to delete whatever I find inappropriate. We have a contract which means she will lose her phone if I find anything dodgy.
I initially banned Instagram but she set it up on a friends phone so I came to the conclusion that it was better for her to have it on hers so that I could monitor and advise.
Interestingly, I did notice that the 'edgy' side always seem to coincide with friendship issues and wanting to be accepted.
She is now almost 15 and has started to say, that she totally understands that it wasn't the best behaviour as she can now see younger girls she knows starting to experiment and she can see that it's not appropriate.
It will be a rocky road ahead and your dsis (and you) will have to learn to guide and advise until she is older. It helps to realise that this age of development means that teens can not reason anything logically and she will not see any risk in what she is doing.
Hold on and try to speak to your sister when she has a few hours to calm down and think of a plan before seeing her DD. She will be horrified and possibly see her daughter differently but it is all part of the process of allowing them to grow up. I have been utterly heart broken but after about a year, out relationship has developed and is now a more grown up one where guidance works much better.