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Mine did the same. I don't think it liked its roots being in the substrate, or the lower levels of the stems weren't getting sufficient light. I broke off the rotty bits and left it floating, which my betta just loves. The plant has recovered beautifully, with new leaves and lots of dangly roots off the stems - so I'd say it's maybe a matter of it needing good light on its stem as well as on the upper leaves.
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