Yeah, that sounds like a potentially chemically harmful sponge:
Most sponges are completely harmless/beneficial, but some can be invasive and/or harmful to corals (thankfully, these are rare).
To tell if a sponge is chemically harmful: if a healthy, established coral starts closing up or looking to be in bad shape on the side closest to the sponge as the sponge grows closer to it, and nothing else has happened (lighting changes, parameter swings, pests, etc.) that could explain it, then the sponge is probably chemically harmful.
Chemically harmful sponges are very rare.
For invasive sponges: unless it shows signs of being chemically harmful or starts actively growing over and smothering a coral's flesh/polyps, it's harmless. These can grow over the skeletons of corals, around the base/stalks of corals, even up into the water column above corals (where they're over the coral but not growing on the flesh or polyps themselves), etc. without harming the coral at all - as long as the coral flesh and polyps can get food, light, and flow, the sponge is harmless.
Invasive sponges are moderately rare.
Invasive and chemically harmful sponges are incredibly rare.
I mention this in my somewhat messy post (linked below), but some sponges can regrow from single cells, so you really have be sure they're dead and gone or that your tank has become a hostile environment to them to ensure they won't come back.
As is also mentioned in my post, predation isn't usually a good option/solution for sponge removal at this point (it's not guaranteed, it's not typically 100% removal, and each predator comes with their own downsides).
Anyway, for the removal:
For removal in case it is a sponge, my post linked below has some ideas you can try - you may also be able to try smothering it using DIY reef snow or similar, but there's no guarantee there:
https://www.reef2reef.com/threads/is-this-a-pest.1055469/#post-12655222If you decide to try the Fenbendazole or something similar, then please post back here and let us know how it goes - while harmful sponges are rare, a more effective treatment to eliminate them would be appreciated by the unlucky few who have them show up.