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Context Engineering in Claude Skills is GENIUS!

...explained visually.

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Context engineering in Claude Skills is GENIUS!

A couple of days back, we talked about Claude Skills and why we think it could be bigger than MCP.

In a gist, it solves a problem most people don’t talk about: agents just keep forgetting everything.

Skills is an attempt to solve this, and it uses a 3-layer context management system that lets it use 100s of skills without hitting context limits.

Let’s understand briefly how it works (we’ll cover this in more detail soon):

  • Layer 1: Main Context - Always loaded, it contains the project configuration.

  • Layer 2: Skill Metadata - Comprises only the YAML frontmatter, about 2-3 lines (< 200 tokens).

  • Layer 3: Active Skill Context - SKILL.md files and associated documentation are loaded as needed.

Supporting files like scripts and templates aren’t pre-loaded but accessed directly when in use, consuming zero tokens.

This architecture supports hundreds of skills without breaching context limits.

In case you missed it, the video at the top is our full tutorial on Claude skills.

It covers:

  • The core idea (skills as SOPs for agents)

  • Anatomy of a skill

  • Skills vs. MCP vs. Projects vs. Subagents

  • Building your own skills

  • Hands-on example

Skills are the early signs of continual learning that Karpathy also talked about in his recent podcast.

The video has everything you need to know!

Thanks for watching!


P.S. For those wanting to develop “Industry ML” expertise:

At the end of the day, all businesses care about impact. That’s it!

  • Can you reduce costs?

  • Drive revenue?

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  • Predict trends before they happen?

We have discussed several other topics (with implementations) that align with such topics.

Develop "Industry ML" Skills

Here are some of them:

  • Learn sophisticated graph architectures and how to train them on graph data.

  • So many real-world NLP systems rely on pairwise context scoring. Learn scalable approaches here.

  • Learn how to run large models on small devices using Quantization techniques.

  • Learn how to generate prediction intervals or sets with strong statistical guarantees for increasing trust using Conformal Predictions.

  • Learn how to identify causal relationships and answer business questions using causal inference in this crash course.

  • Learn how to scale and implement ML model training in this practical guide.

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  • Learn how to build privacy-first ML systems using Federated Learning.

  • Learn 6 techniques with implementation to compress ML models.

All these resources will help you cultivate key skills that businesses and companies care about the most.

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