Humm, its hard to say. What ever it is I don't think its good. My guess is something inside the rock had died and this is bacterial action. As the stuff encrusts the rock it will kill the coralline on it. I would try to get rid of it (don't go nuts...) but try and siphon it out. When you say "its all around" what do you mean? When did it start? Is it tightly adhered? Can you remove it? I bet is a softish cottony type. Thats probably some type of bacteria thats growing from something thats died Let me know Robert