SIM-CoT: Supervised Implicit Chain-of-Thought

Implicit Chain-of-Thought (CoT) methods offer a token-efficient alternative to explicit CoT reasoning in Large Language Models (LLMs), but a persistent performance gap has limited their adoption. We identify a core latent instability issue when scaling the computational budget of implicit CoT: as the number of reasoning tokens increases, training often becomes unstable and collapses. Our analysis shows that this instability arises from latent representations becoming homogeneous and losing semantic diversity, caused by insufficient step-level supervision in current implicit CoT methods. To address this, we propose SIM-CoT, a plug-and-play training module that introduces step-level supervision to stabilize and enrich the latent reasoning space. SIM-CoT employs an auxiliary decoder during training to align each implicit token with its corresponding explicit reasoning step, ensuring latent states capture distinct and meaningful information. The auxiliary decoder is removed at inference, preserving the efficiency of implicit CoT with no added overhead. It also provides interpretability by projecting each latent token onto an explicit reasoning vocabulary, enabling per-step visualization and diagnosis. SIM-CoT significantly improves both in-domain accuracy and out-of-domain stability of implicit CoT methods, boosting Coconut by +8.2\% on GPT-2 and CODI by +3.0\% on LLaMA-3.1 8B. It further surpasses the explicit CoT baseline on GPT-2 by 2.1\% with 2.3$\times$ greater token efficiency, while closing the performance gap on larger models like LLaMA-3.1 8B.