Hi nikki9093,
Water quality is usually the root of problems for new lotl keepers. All a lotl really needs is cool clean water. Simple.
If your filter is new there won't be any or enough bacteria in it to process the waste so the water becomes contaminated. Axies produce ammonia in their poop and through their gills and this is poisonous. The bacteria convert the ammonia into nitrite which is also toxic and other bacteria convert the nitrite into much less harmful nitrate. You need to know this.
What you need to do is grow bacteria in your filter by feeding them with ammonia, but keep your axie away from ammonia. The best way is to keep the axie in a separate container while you feed your filter bacteria. There are articles somewhere on here about 'cycling' , I would recommend you read them.
My juveniles were very happy and healthy in little tanks without filters because I changed large amounts of the water daily or every other day to remove the ammonia. By the way, I started my air driven sponge filters (for the permanent tank) off in a bucket and not in a tank and fed the bacteria with fish food and water from the axie tanks. That way I didn't need the space for the big tank until I had both the bacteria and the axies ready to put together.
Hopefully the salt treatment will get rid of the fungus quickly so you can get your axie back to full health.
Reading again, you obviously have done some reading on cycling. Sorry. It is a difficult balancing act to feed your bacteria while your axie is in there exposed to the ammonia and nitrite, though, and not really recommended. I wouldn't do it and I have many years experience of keeping aquatics.
Because you have done some research and are on here now it will come right in the end.
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