The universe has three main optimizations to combat exponential compute problems. The speed of light, accepting desynced particles and gravitational time dilation. Lazily handling desyncs means you can run computations and just occasionally check for interactions (quantum mechanics), greatly reducing exponential explosions. Same thing with speed of light. And lastly, those two would still break down if you accumulated enough particles in a small area, in those scenarios the computer will just run that part of the simulation slower, until it becomes so bad that the computer just skips computing those areas entirely and it becomes a black hole that is very simple to compute the effects of on its surrounds.

Those three basically ensures we wont ever have problems with lack of compute for the simulation.

Really cool insight. I'd also add dark energy and accelerating cosmic expansion to this list. Without acceleration the size of the observable universe would keep increasing with the passage of time since the Big Bang. That would mean processes running on cosmic timescales could potentially entwine an exponential number of bits.

But with dark energy the size of the observable universe will plateau and start shrinking past a certain date. That caps the number of bits accessible on a cosmic scale.

Interesting. We (humans) would not notice the simulation running slower because we are inside it. Only those on the outside would get frustrated by the fact it is running below realtime, I would guess.

The Voyager space probe entered interstellar space sometime around 2012. My off the wall theory is so many events in the past decade (like a spike in UFO sightings) have been so bizarre because this degraded the simulation quality.