Setting up reverse DNS on IP addresses allows mailbox providers to verify the sender when they do a reverse DNS lookup upon receipt of the emails you send. When you update your DNS provider with a DNS record provided by SendGrid, and then send mail over your IP, the recipient's email service provider performs a reverse DNS lookup (rDNS) using an A Record (address record). An A Record maps your domain to your IP address. When a mailbox provider looks up your A Record, they see your SendGrid IP address. When they look at your IP address, they see the rDNS that match your A Record. This circular checking proves your SendGrid IP association with your domain and your domain association with your SendGrid IP.
In an attempt to clarify complex functionality, SendGrid is upgrading the name of Whitelabel. A whitelabel is now generally called sender authentication. A domain whitelabel is now called domain authentication. A link whitelabel is now called link branding. An IP Whitelabel is now called reverse DNS.