mlsanityData to 7 Oct 2026

Penelope: Localized Latent Recurrence for Efficient Structured Reasoning

arXiv 2607.25915 ↗First posted 28 Jul 2026cs.AIcited by 0

On the map: LLM reasoning → Test-time compute and efficient thinking

Abstract (arXiv)

Complex structured reasoning tasks often require additional computation, yet current language models obtain it mainly by increasing parameter scale or by serializing intermediate steps as chain-of-thought (CoT) tokens. The former raises training and deployment costs, while the latter ties reasoning computation to autoregressive output length. We introduce Penelope, an efficient latent-reasoning framework for pretrained decoder-only Transformers that localizes recurrent computation to a selected decoder interval. The lower decoder prefix is evaluated once to construct a problem-conditioned boundary memory, which is then iteratively refined through time-modulated GRU dynamics and recurrent readout states before answer generation. A progressive CoT-to-latent curriculum transfers visible reasoning into this internal recurrent path, allowing additional computation to be allocated in latent space without repeatedly executing the complete decoder or generating a long intermediate trace. Experiments on open-source structured-reasoning benchmarks show that, at validation-selected latent budgets, Penelope attains competitive accuracy relative to established latent-reasoning models while reducing measured inference latency. These results show that latent refinement can be localized to a narrow decoder interval, reducing repeated full-decoder execution without generating a long visible reasoning trace and providing a practical accuracy-efficiency tradeoff for decoder-only Transformer models.

Key facts. No citing papers in the map yet (data through 7 Oct 2026). Placed in Test-time compute and efficient thinking, one of 17 directions in LLM reasoning. Builds on 5 of its 26 references that are in the map. First posted on arXiv 28 Jul 2026.

Builds on

5 of 26 references.

Closest ancestors · 1

Same direction, newest first

  1. 2026Bridging the Gap Between Latent and Explicit Reasoning with Looped Transformers30 Jun

Other references · 4

  1. 2024The Llama 3 Herd of Modelscited by 14,192
  2. 2016Adaptive Computation Time for Recurrent Neural Networkscited by 479
  3. 2026Training-Free Looped Transformerscited by 12
  4. 2026LoopCoder-v2: Only Loop Once for Efficient Test-Time Computation Scalingcited by 4

Built on by

Not cited yet.

Similar, not cited

Close in wording, no citation either way

  1. 2026Latent Recurrent Thoughts: Recurrent Refinement of Proposed Latents for Reasoning with Frozen LLMs
  2. 2025Scaling up Test-Time Compute with Latent Reasoning: A Recurrent Depth Approach
  3. 2026RecurTrace: Adaptive Latent Reasoning with Loop-Time Memory
  4. 2026Thinking in Latents: Adaptive Anchor Refinement for Implicit Reasoning in LLMs
  5. 2026T^2MLR: Transformer with Temporal Middle-Layer Recurrence
  6. 2026GradCuit: Credit-Assigned Gradient Flow Enables Robust and Interpretable Test-Time Latent Reasoning
  7. 2026Unlocking the Working Memory of Large Language Models for Latent Reasoning
  8. 2025Encode, Think, Decode: Scaling test-time reasoning with recursive latent thoughts