The demo is driven by its soundtrack, so in order to understand what the program needs to do, it helps to have a schematic overview of the various parts of the song.
The three voices of the SID chip are used as follows: Voice 1 is responsible for the kick drum and bass, Voice 2 plays the melody and Voice 3 plays a drone that ducks on all beats, mimicking the genre-typical side-chain compression effect.
All in all, the song contains 64 bars in 4/4 time. It is played back at 112.5 bpm by means of a 60 Hz timer interrupt. The interrupt handler is primarily responsible for music playback, while the visuals are mostly generated in main context.