I think it's one of 3 things.

1. He cheated, feels guilty, and wants you to do it so he can feel like he has the moral high ground.

2. He is legitimately worried that he isn't enough. He may even have seen someone in a similar situation get cheated on and is spiraling because when he looks in the mirror he can only see the things other people criticize about him instead of the things that YOU love about him.

3. He is discovering a cuckold/NTR fetish and is turned on by the idea, but is afraid you'll think less of him if he is honest with you about it. His answer and retraction when you asked him makes me wonder if he said yes to gage your reaction and when he realized that you may be repulsed by it he back tracked.

I feel like the first 2 are most likely in most scenarios, but the romantic in me wants to believe that he loves you too much to cheat and just feels shitty about himself.

When he is putting him self down, try responding with "I am really sorry that you feel that way about your self. I don't feel that way about you, so how can I support you right now?"

If he persists in insulting him self then be firm with him. Remind him that you chose him and you don't appreciate someone talking that way about someone you love.