Definitely, the start of something bad. But, it looks like you caught it pretty early. You should have it checked for stretch. Those rods can be resized on the big end, but I don't know if the heat that caused the blue streak is significant enough to warrant replacement. Check with your machinist. 1 rod isn't a significant expense to save the motor.
More importantly, I think I would be having the crank magnafluxed at this point.