To understand a real-world system, typically simulate a very simplified model on a computer. If our available technology did not limit us, we could have simulated the system to its finer details. However, assume that we have attained enough technical prowess to simulate every single molecule in some future time. Our future scientists might be interested in testing the oft attacked evolution theory by simulating our ancestors. Maybe they just got tired of reasoning with future Santorums and Palins...
This is the starting point for Nick Bostrom’s argument that we might as well be living in a simulation… just like the premise of the movie matrix. He posits that one of the three possibilities is impossible to avoid in our human evolution.
Humanity never survives long enough to reach that level of technological sophistication.
Having attained that sophistication, for some reason, we are not interested in ancestor simulation.
We have already achieved this sophistication, and what we perceive as reality is just an ancestor simulation done by our technologically sophisticated self.
Listen to the nuances in his argument about living in a simulated reality from this podcast from philosophy bites.