Which reactions occur during the oxidation and dissolution of bromide/bromine?
A possibilty is that elementary bromine formed -- causing the the yellow color -- then solubilized in water yielding bromine water.



(source)

It does not dissolve well (2.8% ref -- but do not forget the high density (about 3.10 g/mL) of liquid bromine here). It then may disproportionate into then colorless hypobromit and bromide

$\ce{Br2 + H2O -&gt; Br- + BrO- + 2H+}$ (ref.)

especially under light, forming an acidic solution.  The hypobromit may act as an oxidizer.

To draw an analogy, chlorine gas does dissolve into water, too (ref, ref).

Proceed with caution since bromine is corrosive, though.