A proposal that is given based on limited evidence using which a further point can be explained is considered as a hypothesis.
A hypothesis is an explanation that is proposed to explain why a particular phenomenon is occurring when there is no conclusive evidence for the cause.
In the given scenario, the observation made is that the fish have started falling ill since the number of protists in the area have increased, however this fact is not enough to conclude that the protists are the reason for causing illness to the fish but this could be one of the possible reasons and hence, the proposal given by Nefario is considered as a hypothesis.
