Integrated circuit. He converted the potentiometer signals (variable resistance) from a Gamecube stick to photodiode signals (that a genuine N64 controller uses) by programming a chip and putting it in the circuit.
And for anyone who still doesn't know what photodiodes are, it is what N64 controller joysticks use, and is actually much more accurate and a better option than the cheaper potentiometers.
Everybody remember these? Well, if you look at your N64 controller, you'll find two small black wheel things with tons of holes, like the white viewmaster slides, connected to the big white part that the stick rests in. When the joystick is moved, these black pieces spin, and as the holes pass a beam of light, the main chip interprets how many times the light is broken and how fast to determine the digital signal (what happens in the game).
Quite fascinating, really! Just like laser tripmines!
I once had thoughts of recreating the white bowl part, since it's the main culprit here, getting ground away all the time, but gave up because of how precise the measurements and quality was. I just don't have the tools to measure it out, and I'm not sure the ****ty 3-D printer I was thinking of using would work....