Yeah fungus, but also the sludge sometimes forms a crust on the top inch or so of whatever you dump it on, especially if you do it repeatedly or your water is super sludgy (like my turtle filter produces some crazy sludge). It can also end up with salt buildup, not necessarily sodium salt, but just any sort of mineral residue that builds up and crystallizes. An occasional soak and rinse will clear all that stuff out, and leave you with reasonably clean coir once more.

As for the fungus, that’s super normal, but if you want to avoid it potentially being a problem, you can pick up some soil amendment that contains beneficial fungus (the sort that works with plant roots to increase nutrient and moisture absorption) to outcompete the nasty stuff you don’t want. You’ll want to look for a Mycorrhiza mix, which means symbiotic relationship between fungus and plant. There are tons of options available, I’ve used a powder variety to great effect.

A deep substrate can also help filter ammonia. My 75 gallon freshwater tank requires very little in filter cleaning and water changes thanks to a good cleanup crew, lots of surface area for bacteria, deep-ish substrate, and lots of plants.

Our marine tank is similar. That tank also has a second smaller tank beneath, called a sump, where there is extra rock and biomedia for beneficial bacteria. That tank has a second lighting system set to an opposite photoperiod from the main tank and has a specific type of macroalgae (chaeto) which gobbles up phosphates during the main tank's night hours.

It can be a delicate balancing act getting it all working well, but when tanks get established it gets to be fairly routine keeping it all going.