CoRe: Co-Evolving Reward Models for Mitigating Latent Reward Hacking in Video Diffusion Models

Latent reward models (LRMs) enable efficient alignment of video diffusion models by scoring intermediate states directly in latent space. However, we find that optimizing against a fixed latent reward rapidly leads to latent reward hacking: the predicted reward stays high while perceptual and motion quality deteriorate. Our analysis identifies distributional escape as the central cause: within a few hundred updates, the generator moves beyond the reward model's training support, where its scores no longer reflect video quality. Based on this insight, we introduce CoRe, a co-evolving reward framework that treats latent-space alignment as a dynamic interaction between the generator and the reward model. Rather than optimizing against a stationary proxy, CoRe continually refits the reward model on the generator's current samples while anchoring it to real-video preferences, so the generator cannot gain reward by drifting away from the data. On Wan2.1-T2V-1.3B, experiments show that CoRe consistently improves generation quality over both the pretrained model and prior alignment methods, while avoiding the quality collapse of fixed-reward optimization.