The future of harnesses cannot be „resend the whole history on every step“ or whatever this terrible compaction is.

Most of the context is unstructured fluff, much of it is distracting or even plain wrong. Especially the „thinking“ tokens are often completely disjoint halucinations that don’t make any sense.

I think what will have to happen is that context looks less like a long chat and action log and more like a structured, short, schema validated state description, plus a short log trace that only grows until a checkpoint is reached, which produces a new state.