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.