Of course the method described requires both input and output buffers, because everything is processed last-character-first.

Now that you mention it, if the assignment had called for arguments, instead of files or pipes, argv points to a writable array, so the result could be written directly to it, negating any need to allocate memory, and any out-of-memory conditions from large input data would occur before the program is even called.

If it usually uses a file to store the numbers, the same could be done by writing the result back to the file, but that only works if it is passed as an argument, as piping it would throw a seek error. I wonder if the instructor would accept an interleaved little-endian input syntax, with a little-endian output; then the program could use pipes without a need to seek. An infinite series of '9' characters would output an '8', followed by one '9' per two input characters.