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If a simulation is indistinguishable from reality, it doesn't prove anything about the nature of reality. However, it doesn't rule out the possibility that this reality is some form of simulation, since we are incapable of detecting the difference between veridical perception and hallucination.
It does not follow that since we will be able to make reality and simulation indistinguishable, that therefore reality is a simulation. That's a non-sequitur.
With this reasoning, the opposite is true:
"Since reality is indistinguishable from simulation, it logically follows that we are almost certainly in reality."
This assumes at least two things: (a) that we will be able to create a simulation someday that will in fact become indistinguishable from reality, and (b) that we will want to perform this experiment when we get there.
The likelihood that we are at the "top of the chain" is approaching zero. However, the idea that the chain has a start is an axiom that we cannot prove, and without it the word "simulation" loses a lot of meaning.
when thinking likes this. i think of the classic: ''if there was a god why would the world be in such a bad condition?''. because we are just piloting our own society, why not the universe for that matter. Brilliant
By merely being able to ask this question at a bare minimum I have a conscience that exists in a form of reality, even if everything I see, touch, taste, and feel is an illusion.