They typically brown over the cut area as they callus. Hard to tell from the photo if that is normal or not.......but you should be able to feel it. If it is soft and squishy it is rot, if it is reasonably firm probably just normal callus. IF it is soft......cut it back further up, past the brown soft tissue. Why root in water?? I find these guys root fast in high humidity and warmth. Fill a pot with a nice loose open soil mix and lightly moisten. Plant your cutting. Put the whole thing in a very large clear bag. Put it in bright but indirect light (not sun.........you don't want to cook it inside the bag). after about two weeks it will have nice roots, gradually open the bag more and more. That is a nice big/fat cutting, can we see a photo of the parent plant for fun?