Claude API Drops budget_tokens: Developers Must Switch to Adaptive Thinking

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Anthropic's Claude models from version 4.7 onward have removed support for the budget_tokens parameter in the thinking configuration, causing 400 errors for developers relying on the old pattern. The fixed token budget system has been replaced by adaptive thinking, where the model itself determines how much reasoning to apply, guided by a new effort parameter ranging from low to max. Developers must replace thinking: { type: 'enabled', budget_tokens: N } with thinking: { type: 'adaptive' } and add an output_config effort level suited to each use case. Additional breaking changes include the removal of temperature, top_p, and top_k parameters on the same model versions, and thinking block text is now hidden by default during streaming unless display: 'summarized' is explicitly set. Early testing suggests that higher effort settings can sometimes reduce total token cost on multi-step agentic tasks by improving upfront planning and reducing the number of turns required.

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