"Instance head is not headed by a class" when `Constraint` replaced with `type C = Constraint`

{-# Language DataKinds, TypeInType, TypeFamilies #-}

import Data.Kind

newtype I a = I a

type C = Constraint

type family
  UnitC :: Constraint where
  UnitC = ()

instance UnitC => Functor I where
  fmap = undefined 

this works fine, but if I try to use the constraint synonym C (UnitC :: C where) fails with "Instance head is not headed by a class" which has no Google hits outside of the compiler

$ ghci -ignore-dot-ghci hs/249.hs
GHCi, version 8.5.20180128: http://www.haskell.org/ghc/  :? for help
[1 of 1] Compiling Main             ( hs/249.hs, interpreted )

hs/249.hs:13:10: error:
    • Instance head is not headed by a class
    • In the instance declaration for ‘Functor I’
   |
13 | instance UnitC => Functor I where
   |          ^^^^^^^^^^^^^^^^^^
Failed, no modules loaded.
Prelude> 

Trac metadata

Trac field	Value
Version	8.4.3
Type	Bug
TypeOfFailure	OtherFailure
Priority	normal
Resolution	Unresolved
Component	Compiler
Test case
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