This Device will take an 8-bit (1 byte) Binary number & compress it & send it along 2 wires instead of 8,
The 'input' will be where you set the data & press a button to send the data,
The 'output' will receive the data, and decompress it back to its binary form.
This device reads the data based on pulses that the inputs sends out, so it does take a few seconds to read the data fully,

The MCedit schematic is actually a .zip containing 2 schematics, the input & output,

The 2 wires are colour coded so you should know which wire is which, as is you get the 2 wires mixed up (obv) the device wont work,

Both of the wires must take the same time to travel from the input to the output.