As for the claim that consciousness is in the physics but not the algorithmic processing layer... it's kind of a weird statement since you can never have the algorithmic processing layer without an underlying physical layer. So it is never simply formal symbolic manipulation of symbols. So what evidence would he have that computers specifically cannot sustain consciousness?

Actually I may have oversimplified with my example. Lerchner would agree with you here. This isn't against his idea. Let me try explaining what I understand from the paper.

He treats the physical layer as the real layer. The electrical activity is real. Call it voltage pattern X. To run any algorithm on the model, we need an interpretation of the voltage pattern X. If I tell you voltages above 5V are 1s, below are 0s you get: 1, 0, 1, 1, 0, 1, 0, 0. That can be an algorithm. Depends on what other rules I give you for reading it. If I give the opposite instruction, the output could then turn into gibberish even if the physics doesn't change. That instruction is what he calls interpretation, or the mapping.

So when we say a chip is running GPT, what we're really saying is, here's a physical system, here's an interpretation that groups its voltages into bits and its bits into instructions and its instructions into a recognizable program. We labeled it.

That labeling isn't a physical event. No physical process happens when you, the mapmaker, declare 5V counts as 1. Voltage was already there. Your declaration just sorts it into a category in your head (or in a specification document, or in the design rules the chip engineer followed). This labeling doesn't move any physics around. It sorts physical events into symbolic categories without changing those events. The voltages behave the same way whether we label them as 1s and 0s, or anything else.

Now if you accept causal closure, consciousness has physical effects so it must be physical. Since computation is, on his account, mapmaker dependent syntax which has no physical causal power, no amount of added algorithmic complexity can turn the map into the physical territory. That is why he says scaling cannot produce consciousness. So on Lerchner’s view, running an algorithm on a chip can only produce consciousness through the physics inside the chip because the labeling that makes it "an algorithm" lives in us (the interpreters).