It could be some type of rot, hopefully other users can advise on treatment options. If that’s the consensus.
Alternatively, it could be kept too dry or too cold. The bark looks pretty dry and Paphs don’t like to dry out completely. As soon as the media approaches dryness: it’s time to water. Mine also don’t like prolonged exposure to temperatures below 65 degrees Fahrenheit. Most of mine have also responded very positively to being repotted into fresh media so if the bark is old, repotting, watering, and keeping it warm could give it a kick start to recover and push healthy new growth.
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