Incorrect spelling, explanation: this form is a mistake, because the correct one, instead, comes from Middle English in stead (in place of something else, as a substitute). Instade, therefore, is an incorrect form, and the correct one is instead.

Correct spelling, explanation: in Middle English, the form of the word instead was separate: in stead. Stead means a place occupied by substitute. Later it became a one-word. This is the reason why we write this word instead, not instade (this mistake may be caused by pronunciation).

Definition of instead:
adverb, in place of something else
You should have bought the cheaper dress instead.
Instead of going to the party, you should study for the exam.