I just read an amazing op-ed by Elon Musk yesterday about simulation theory, and the probability we're in one. Following are some quotes from him:

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You could argue that any group of people — like a company — is essentially a cybernetic collective of human people and machines. That’s what a company is. And then there are different levels of complexity in the way these companies are formed and then there is a collective AI in Google search, where we are also plugged in like nodes in a network, like leaves in a tree.

We’re all feeding this network without questions and answers. We’re all collectively programming the AI and Google. […] It feels like we are the biological boot-loader for AI effectively. We are building progressively greater intelligence. And the percentage that is not human is increasing, and eventually we will represent a very small percentage of intelligence.

The argument for the simulation I think is quite strong. Because if you assume any improvements at all over time — any improvement, one percent, .1 percent. Just extend the time frame, make it a thousand years, a million years — the universe is 13.8 billion years old. Civilization if you are very generous is maybe seven or eight thousand years old if you count it from the first writing. This is nothing. So if you assume any rate of improvement at all, then [virtual reality video] games will be indistinguishable from reality. Or civilization will end. Either one of those two things will occur. Or we are most likely living in a simulation.

There are many many simulations. These simulations, we might as well call them reality, or you can call them multiverse. They are running on a substrate. That substrate is probably boring.

When we create a simulation like a game or movie, it’s a distillation of what’s interesting about life. It takes a year to shoot an action movie. And that is distilled down into two to three hours. But the filming is boring. It’s pretty goofy, doesn’t look cool. But when you add the CGI and upgrade editing, it’s amazing. So i think most likely, if we’re a simulation, it’s really boring outside the simulation. Because why would you make the simulation as boring? [You’d] make simulation way more interesting than base reality.

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I find his argument persuasive and convincing for the simulation hypothesis. I don't think computers are prohibited by the laws of physics to render reality as a simulation, thus is he right in the last piece of the interview?