That looks like Nephthea am I correct? If so I have had this happen two times. Once the coral died over the course of about a week. It sped up at the end, looking like what you had for a few days before melting. The other time it created what looked like a necrotic lesion that rotted away for a few days but then suddenly vanished and the coral recovered fast with not sign of damage in a week or two.
I'm not sure what caused it, but both cases were from the same day that I fragged a few pieces. I was guessing at the time that it might be some kind of bacterial infection but that is really just a very rough guess.