Yeah, as mentioned, that is a sponge, but it's not a pineapple sponge - pineapple sponges are from the genus Sycon and are (to my knowledge) called pineapple sponges because they're little tube shapes with a little spiky ring around the big hole in the sponge; between the shape and the ring, they look like little pineapples.
Regardless, while some sponges can grow over and smother corals, harm corals through allelopathy (chemical warfare like soft corals are known for), or - in extremely rare cases - both, it's quite rare that they cause any issues.
In this case, the sponge doesn't seem to bothering the coral chemically, and the growth rate you described for it doesn't seem particularly fast, so this sponge is most likely harmless.
Even if it did start spreading rapidly, though, that alone wouldn't necessarily mean it's harmful, it would just mean it's invasive - a number of invasive sponges are totally harmless, and can grow on/over a coral's skeleton without harming the polyps (I've even seen some cases where they grow all the way up a coral's stalk to stop at the flesh, and cases where they weave between the polyps of encrusting corals without harming the coral itself).
In either case, your sponge doesn't seem chemically harmful or invasive at the moment, so it's most likely harmless/beneficial, but if you do want to remove it, doing so out of the tank in a bowl of tank water and rinsing the coral off after with new tank water of freshly mixed saltwater before adding it back to your tank would be my suggestion.
