He is at the very least an avatar of whoever is operating this carnival ride.
And whoever is controlling it could be one of the following:
-A Ditto Consciousness. We saw back during the Sparkplug saga that "Wild Dittos" can be outright hostile, malicious or downright lethal.
-Holly. If the Ditto simulation just latched onto the psyche of the first person to cross the portal and now she is running this nightmare semi-subconsciously.
-A figure from Holly's past. Big coincidence unless a force like Aaron Marx orchestrated it.
-Somebody new who actively goes of his way to interact with the minds of others.