It's not a very convincing argument because there's absolutely zero actual evidence to back the argument up, and absolutely zero reason to even accept the axioms the argument is based on.
The standard argument for simulation boils down to "in the future, we'll get access to insane computational ability, and someone is bound to run ancestor simulations just because we can; once this becomes possible, the amount of time consumed by such simulations will dwarf the time of history." In other words, the argument is basically "it's not impossible, so it will eventually happen, and over a long enough time period, it doesn't matter how long it takes to happen."
(As you might imagine, I am not persuaded by this argument.)
No, it's far more likely that we're the result of an emergency overload dump of a runaway thaumic reactor experiment run in the squash court of a university for wizards on a much more sensible flat world. There's far less hand-waving in that narrative.
There is only one "real" universe. If simulations are being run there's a potentially incomprehensible number of simulated universes. As a member of one of those universes, it is probable you are in one of the many simulations and not the only "real" universe.
If we are, then it pushes back 'reality' one step back but the question of what 'reality' is remains. And that even opens new questions.
In my view this is similar the question of the origin of the Universe.
Both questions boil down to either a singularity or to infinity. It's difficult for the mind to make sense of either.