Challenge: Write an algo

[na_th_an]

Well, first of all I examined the stream. I saw that the symbol # repeated all over the place, in a pseudocyclic fashion, so I guessed it was the encoded "SPACE" character. As it looked so much as the "word delimiter" I guessed that a straightforward method was used, and that each symbol represented one only character. I noticed that ASC("#") = ASC(" ") XOR 3, partially guessing 'cause this guy had posted two XOR encryption/decryption algos earlier that week. I cheated