I really disagree with the fundamental assumption there.
I find it very difficult to believe that a base universe could ever simulate something of the complexity of our universe without massive and pointless expense, at best. And even if they could, I find it even more unlikely that simulated universes would ever even be dense in the subset of multiverses (whichever flavor your like) which contain something like humans.
I agree, and additionally, it might take an awful lot of time until a civilization is advanced enough to reach the point where it can simulate other beings. For all we know, we can be the first beings to ever reach this point.
I find it very difficult to believe that a base universe could ever simulate something of the complexity of our universe without massive and pointless expense, at best. And even if they could, I find it even more unlikely that simulated universes would ever even be dense in the subset of multiverses (whichever flavor your like) which contain something like humans.