[BUG] With the last changes - now claude is consuming too much memory in same repository with all most same amount of code

Preflight Checklist

• [x] I have searched existing issues and this hasn't been reported yet
• [x] This is a single bug report (please file separate reports for different bugs)
• [x] I am using the latest version of Claude Code

What's Wrong?

I am concerned with data privacy and data rights over the code as I believe Claude is taking all the code created to remote as Memory footprint has gone up significantly in same directory with same code . I also notice screen flickering which makes me think it is doing screen scraping

What Should Happen?

Claude should only load directory context when required and what is required

Error Messages/Logs

Steps to Reproduce

simple start claude code in any of the directory and watch the memory grow

Claude Model

Sonnet (default)

Is this a regression?

Yes, this worked in a previous version

Last Working Version

_No response_

Claude Code Version

2.0.20 (Claude Code)

Platform

Anthropic API

Operating System

Ubuntu/Debian Linux

Terminal/Shell

Terminal.app (macOS)

Additional Information

_No response_