SemanticFold: Latent Sequence Compression SeparatesLanguage Modeling, Decodability, and Reasoning
We study whether latent sequence compression of prompt prefixes preserves the capabilities that large language models rely on during inference. We introduce SemanticFold, a compression scheme that folds prefix hidden states at learned boundaries, and evaluate it across five model scales: Qwen3-1.7B, Qwen3-8B, SmolLM2-1...