Impressed and curious, I had a go at implementing the algorithm in C. I took the opportunity to go one better and implement a 4-stage counter. Keil C51 does a very good job of generating code for this souce - just 30 instructions.

void fast_debouce( void ) small
{
    static unsigned char vertical_counter_d = 0;
    static unsigned char vertical_counter_c = 0;
    static unsigned char vertical_counter_b = 0;
    static unsigned char vertical_counter_a = 0;

           unsigned char t;

    //Increment the vertical counter.

    vertical_counter_d = vertical_counter_d ^ ( (vertical_counter_a & vertical_counter_b) & vertical_counter_c );
    vertical_counter_c = vertical_counter_c ^   (vertical_counter_a & vertical_counter_b);
    vertical_counter_b = vertical_counter_b ^    vertical_counter_a;
    vertical_counter_a = ~vertical_counter_a;

    t = boucy_source ^ debouced_source;

    vertical_counter_a = vertical_counter_a & t;
    vertical_counter_b = vertical_counter_b & t;
    vertical_counter_c = vertical_counter_c & t;
    vertical_counter_d = vertical_counter_d & t;

    t = ~t;

    t = t | vertical_counter_a;
    t = t | vertical_counter_b;
    t = t | vertical_counter_c;
    t = t | vertical_counter_d;

    t = ~t;

    debouced_source = debouced_source ^ t;
}