My experience with FW systems always indicated that nitrifying bacteria colonizes solid objects (ie. decor, tank wall, filter media, etc.). No one I've never heard of has ever said that they've managed to instantly cycle a tank by just transfering water over from an established tank... though I've heard of (and experienced myself) many people who have just about instantly cycled a tank by transfering over a decent amount of filter media and/or decor over from an established tank.
I suspect that SW systems are simliar, and from what I understand, it is.
-Richer
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