I'd say it's neither of those. Probably like mentioned above STN.. Sudden tissue necrosis / RTN rapid tissue necrosis. Is there any other sps in the tank? It's a fairly common thing that has happened at one time or another to most who keep sps..
It's a signal that the coral is not happy in the environment or is stressed, but in reality it could be a lot of things light, flow, nutrients, alk or pretty much anything. It's a mystery on why it happens sometimes but ime it's mostly due to alk swings or overall instability. Some are way more sensitive then others and stylo's are pretty hardy usually so either it was in bad shape when you got it or there is something going on in the tank.
You should read up on the stickies above in this forum for sps care in general if your new to them. It will get you up to speed on what the acronym's are and how to best care for them and provide what it needs to save you money and headaches.
Good luck with it and I(mirroring above) would definitely frag it now if you want to save it.