From e8307de5a83109c96d1528eb3857ddf5253f4060 Mon Sep 17 00:00:00 2001
From: Illia Panasenko <ilyap@wix.com>
Date: Tue, 28 Apr 2026 23:21:09 +0200
Subject: [PATCH 1/3] Add hide whitespace option for diffs

---
 apps/desktop/src/clientPersistence.test.ts    |  1 +
 .../orchestrationEngine.integration.test.ts   |  2 +
 .../Layers/CheckpointDiffQuery.test.ts        | 12 ++-
 .../Layers/CheckpointDiffQuery.ts             |  3 +
 .../Layers/CheckpointStore.test.ts            | 76 +++++++++++++++++++
 .../checkpointing/Layers/CheckpointStore.ts   | 12 ++-
 .../checkpointing/Services/CheckpointStore.ts |  1 +
 .../orchestration/Layers/CheckpointReactor.ts |  1 +
 apps/web/src/components/DiffPanel.tsx         | 18 ++++-
 .../components/settings/SettingsPanels.tsx    | 30 ++++++++
 apps/web/src/lib/providerReactQuery.test.ts   | 58 +++++++++++++-
 apps/web/src/lib/providerReactQuery.ts        |  4 +
 apps/web/src/localApi.test.ts                 |  2 +
 packages/contracts/src/orchestration.test.ts  | 25 ++++++
 packages/contracts/src/orchestration.ts       |  6 +-
 packages/contracts/src/settings.ts            |  2 +
 16 files changed, 247 insertions(+), 6 deletions(-)

diff --git a/apps/desktop/src/clientPersistence.test.ts b/apps/desktop/src/clientPersistence.test.ts
index 192d7ac106..fcd1786029 100644
--- a/apps/desktop/src/clientPersistence.test.ts
+++ b/apps/desktop/src/clientPersistence.test.ts
@@ -52,6 +52,7 @@ const clientSettings: ClientSettings = {
   autoOpenPlanSidebar: false,
   confirmThreadArchive: true,
   confirmThreadDelete: false,
+  diffIgnoreWhitespace: true,
   diffWordWrap: true,
   favorites: [],
   sidebarProjectGroupingMode: "repository_path",
diff --git a/apps/server/integration/orchestrationEngine.integration.test.ts b/apps/server/integration/orchestrationEngine.integration.test.ts
index a7f845672c..e97844d338 100644
--- a/apps/server/integration/orchestrationEngine.integration.test.ts
+++ b/apps/server/integration/orchestrationEngine.integration.test.ts
@@ -496,6 +496,7 @@ it.live("runs multi-turn file edits and persists checkpoint diffs", () =>
         fromCheckpointRef: checkpointRefForThreadTurn(THREAD_ID, 1),
         toCheckpointRef: checkpointRefForThreadTurn(THREAD_ID, 2),
         fallbackFromToHead: false,
+        ignoreWhitespace: false,
       });
       assert.equal(incrementalDiff.includes("README.md"), true);
 
@@ -504,6 +505,7 @@ it.live("runs multi-turn file edits and persists checkpoint diffs", () =>
         fromCheckpointRef: checkpointRefForThreadTurn(THREAD_ID, 0),
         toCheckpointRef: checkpointRefForThreadTurn(THREAD_ID, 2),
         fallbackFromToHead: false,
+        ignoreWhitespace: false,
       });
       assert.equal(fullDiff.includes("README.md"), true);
 
diff --git a/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.test.ts b/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.test.ts
index e6c53dd06b..81aa6d563b 100644
--- a/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.test.ts
+++ b/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.test.ts
@@ -48,6 +48,7 @@ describe("CheckpointDiffQueryLive", () => {
       readonly fromCheckpointRef: CheckpointRef;
       readonly toCheckpointRef: CheckpointRef;
       readonly cwd: string;
+      readonly ignoreWhitespace: boolean;
     }> = [];
 
     const threadCheckpointContext = makeThreadCheckpointContext({
@@ -68,9 +69,14 @@ describe("CheckpointDiffQueryLive", () => {
           return true;
         }),
       restoreCheckpoint: () => Effect.succeed(true),
-      diffCheckpoints: ({ fromCheckpointRef, toCheckpointRef, cwd }) =>
+      diffCheckpoints: ({ fromCheckpointRef, toCheckpointRef, cwd, ignoreWhitespace }) =>
         Effect.sync(() => {
-          diffCheckpointsCalls.push({ fromCheckpointRef, toCheckpointRef, cwd });
+          diffCheckpointsCalls.push({
+            fromCheckpointRef,
+            toCheckpointRef,
+            cwd,
+            ignoreWhitespace,
+          });
           return "diff patch";
         }),
       deleteCheckpointRefs: () => Effect.void,
@@ -102,6 +108,7 @@ describe("CheckpointDiffQueryLive", () => {
           threadId,
           fromTurnCount: 0,
           toTurnCount: 1,
+          ignoreWhitespace: true,
         });
       }).pipe(Effect.provide(layer)),
     );
@@ -113,6 +120,7 @@ describe("CheckpointDiffQueryLive", () => {
         cwd: "/tmp/workspace",
         fromCheckpointRef: expectedFromRef,
         toCheckpointRef,
+        ignoreWhitespace: true,
       },
     ]);
     expect(result).toEqual({
diff --git a/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.ts b/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.ts
index 1c2edee469..cb1433c21c 100644
--- a/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.ts
+++ b/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.ts
@@ -24,6 +24,7 @@ const make = Effect.gen(function* () {
   const getTurnDiff: CheckpointDiffQueryShape["getTurnDiff"] = Effect.fn("getTurnDiff")(
     function* (input) {
       const operation = "CheckpointDiffQuery.getTurnDiff";
+      const ignoreWhitespace = input.ignoreWhitespace ?? false;
 
       if (input.fromTurnCount === input.toTurnCount) {
         const emptyDiff: OrchestrationGetTurnDiffResultType = {
@@ -131,6 +132,7 @@ const make = Effect.gen(function* () {
         fromCheckpointRef,
         toCheckpointRef,
         fallbackFromToHead: false,
+        ignoreWhitespace,
       });
 
       const turnDiff: OrchestrationGetTurnDiffResultType = {
@@ -157,6 +159,7 @@ const make = Effect.gen(function* () {
       threadId: input.threadId,
       fromTurnCount: 0,
       toTurnCount: input.toTurnCount,
+      ignoreWhitespace: input.ignoreWhitespace ?? false,
     }).pipe(Effect.map((result): OrchestrationGetFullThreadDiffResult => result));
 
   return {
diff --git a/apps/server/src/checkpointing/Layers/CheckpointStore.test.ts b/apps/server/src/checkpointing/Layers/CheckpointStore.test.ts
index fe377eb1ec..e7bb40bc03 100644
--- a/apps/server/src/checkpointing/Layers/CheckpointStore.test.ts
+++ b/apps/server/src/checkpointing/Layers/CheckpointStore.test.ts
@@ -111,6 +111,7 @@ it.layer(TestLayer)("CheckpointStoreLive", (it) => {
           cwd: tmp,
           fromCheckpointRef,
           toCheckpointRef,
+          ignoreWhitespace: false,
         });
 
         expect(diff).toContain("diff --git");
@@ -118,5 +119,80 @@ it.layer(TestLayer)("CheckpointStoreLive", (it) => {
         expect(diff).toContain("+line 04999");
       }),
     );
+
+    it.effect("can hide indentation churn when changes wrap existing lines", () =>
+      Effect.gen(function* () {
+        const tmp = yield* makeTmpDir();
+        yield* initRepoWithCommit(tmp);
+        const checkpointStore = yield* CheckpointStore;
+        const threadId = ThreadId.make("thread-checkpoint-store-whitespace");
+        const fromCheckpointRef = checkpointRefForThreadTurn(threadId, 0);
+        const toCheckpointRef = checkpointRefForThreadTurn(threadId, 1);
+
+        const componentPath = path.join(tmp, "Component.tsx");
+        yield* writeTextFile(
+          componentPath,
+          [
+            "export function View() {",
+            "  return (",
+            "    <section>",
+            "      <h1>Title</h1>",
+            "      <p>Body</p>",
+            "    </section>",
+            "  );",
+            "}",
+            "",
+          ].join("\n"),
+        );
+        yield* checkpointStore.captureCheckpoint({
+          cwd: tmp,
+          checkpointRef: fromCheckpointRef,
+        });
+        yield* writeTextFile(
+          componentPath,
+          [
+            "export function View() {",
+            "  return (",
+            "    <section>",
+            "      {isReady ? (",
+            "        <div>",
+            "          <h1>Title</h1>",
+            "          <p>Body</p>",
+            "        </div>",
+            "      ) : null}",
+            "    </section>",
+            "  );",
+            "}",
+            "",
+          ].join("\n"),
+        );
+        yield* checkpointStore.captureCheckpoint({
+          cwd: tmp,
+          checkpointRef: toCheckpointRef,
+        });
+
+        const normalDiff = yield* checkpointStore.diffCheckpoints({
+          cwd: tmp,
+          fromCheckpointRef,
+          toCheckpointRef,
+          ignoreWhitespace: false,
+        });
+        const whitespaceIgnoredDiff = yield* checkpointStore.diffCheckpoints({
+          cwd: tmp,
+          fromCheckpointRef,
+          toCheckpointRef,
+          ignoreWhitespace: true,
+        });
+
+        expect(normalDiff).toContain("diff --git");
+        expect(normalDiff).toContain("-      <h1>Title</h1>");
+        expect(normalDiff).toContain("+          <h1>Title</h1>");
+        expect(whitespaceIgnoredDiff).toContain("diff --git");
+        expect(whitespaceIgnoredDiff).toContain("+      {isReady ? (");
+        expect(whitespaceIgnoredDiff).toContain("+        <div>");
+        expect(whitespaceIgnoredDiff).not.toContain("-      <h1>Title</h1>");
+        expect(whitespaceIgnoredDiff).not.toContain("+          <h1>Title</h1>");
+      }),
+    );
   });
 });
diff --git a/apps/server/src/checkpointing/Layers/CheckpointStore.ts b/apps/server/src/checkpointing/Layers/CheckpointStore.ts
index 211877e9b1..d1efe475e0 100644
--- a/apps/server/src/checkpointing/Layers/CheckpointStore.ts
+++ b/apps/server/src/checkpointing/Layers/CheckpointStore.ts
@@ -243,10 +243,20 @@ const makeCheckpointStore = Effect.gen(function* () {
         });
       }
 
+      const diffArgs = [
+        "diff",
+        "--patch",
+        "--minimal",
+        "--no-color",
+        ...(input.ignoreWhitespace ? ["--ignore-all-space"] : []),
+        fromCommitOid,
+        toCommitOid,
+      ];
+
       const result = yield* git.execute({
         operation,
         cwd: input.cwd,
-        args: ["diff", "--patch", "--minimal", "--no-color", fromCommitOid, toCommitOid],
+        args: diffArgs,
         maxOutputBytes: CHECKPOINT_DIFF_MAX_OUTPUT_BYTES,
       });
 
diff --git a/apps/server/src/checkpointing/Services/CheckpointStore.ts b/apps/server/src/checkpointing/Services/CheckpointStore.ts
index d9a43fa4e9..be6bdbccfa 100644
--- a/apps/server/src/checkpointing/Services/CheckpointStore.ts
+++ b/apps/server/src/checkpointing/Services/CheckpointStore.ts
@@ -32,6 +32,7 @@ export interface DiffCheckpointsInput {
   readonly fromCheckpointRef: CheckpointRef;
   readonly toCheckpointRef: CheckpointRef;
   readonly fallbackFromToHead?: boolean;
+  readonly ignoreWhitespace: boolean;
 }
 
 export interface DeleteCheckpointRefsInput {
diff --git a/apps/server/src/orchestration/Layers/CheckpointReactor.ts b/apps/server/src/orchestration/Layers/CheckpointReactor.ts
index 71445b4671..80caf99d2b 100644
--- a/apps/server/src/orchestration/Layers/CheckpointReactor.ts
+++ b/apps/server/src/orchestration/Layers/CheckpointReactor.ts
@@ -237,6 +237,7 @@ const make = Effect.gen(function* () {
         fromCheckpointRef,
         toCheckpointRef: targetCheckpointRef,
         fallbackFromToHead: false,
+        ignoreWhitespace: false,
       })
       .pipe(
         Effect.map((diff) =>
diff --git a/apps/web/src/components/DiffPanel.tsx b/apps/web/src/components/DiffPanel.tsx
index e6dbb57cc7..28db53e917 100644
--- a/apps/web/src/components/DiffPanel.tsx
+++ b/apps/web/src/components/DiffPanel.tsx
@@ -8,6 +8,7 @@ import {
   ChevronLeftIcon,
   ChevronRightIcon,
   Columns2Icon,
+  PilcrowIcon,
   Rows3Icon,
   TextWrapIcon,
 } from "lucide-react";
@@ -172,6 +173,7 @@ export default function DiffPanel({ mode = "inline" }: DiffPanelProps) {
   const settings = useSettings();
   const [diffRenderMode, setDiffRenderMode] = useState<DiffRenderMode>("stacked");
   const [diffWordWrap, setDiffWordWrap] = useState(settings.diffWordWrap);
+  const [diffIgnoreWhitespace, setDiffIgnoreWhitespace] = useState(settings.diffIgnoreWhitespace);
   const patchViewportRef = useRef<HTMLDivElement>(null);
   const turnStripRef = useRef<HTMLDivElement>(null);
   const previousDiffOpenRef = useRef(false);
@@ -277,6 +279,7 @@ export default function DiffPanel({ mode = "inline" }: DiffPanelProps) {
       threadId: activeThreadId,
       fromTurnCount: activeCheckpointRange?.fromTurnCount ?? null,
       toTurnCount: activeCheckpointRange?.toTurnCount ?? null,
+      ignoreWhitespace: diffIgnoreWhitespace,
       cacheScope: selectedTurn ? `turn:${selectedTurn.turnId}` : conversationCacheScope,
       enabled: isGitRepo,
     }),
@@ -317,9 +320,10 @@ export default function DiffPanel({ mode = "inline" }: DiffPanelProps) {
   useEffect(() => {
     if (diffOpen && !previousDiffOpenRef.current) {
       setDiffWordWrap(settings.diffWordWrap);
+      setDiffIgnoreWhitespace(settings.diffIgnoreWhitespace);
     }
     previousDiffOpenRef.current = diffOpen;
-  }, [diffOpen, settings.diffWordWrap]);
+  }, [diffOpen, settings.diffIgnoreWhitespace, settings.diffWordWrap]);
 
   useEffect(() => {
     if (!selectedFilePath || !patchViewportRef.current) {
@@ -551,6 +555,18 @@ export default function DiffPanel({ mode = "inline" }: DiffPanelProps) {
         >
           <TextWrapIcon className="size-3" />
         </Toggle>
+        <Toggle
+          aria-label={diffIgnoreWhitespace ? "Show whitespace changes" : "Hide whitespace changes"}
+          title={diffIgnoreWhitespace ? "Show whitespace changes" : "Hide whitespace changes"}
+          variant="outline"
+          size="xs"
+          pressed={diffIgnoreWhitespace}
+          onPressedChange={(pressed) => {
+            setDiffIgnoreWhitespace(Boolean(pressed));
+          }}
+        >
+          <PilcrowIcon className="size-3" />
+        </Toggle>
       </div>
     </>
   );
diff --git a/apps/web/src/components/settings/SettingsPanels.tsx b/apps/web/src/components/settings/SettingsPanels.tsx
index 29d09a5cdc..092c3bd307 100644
--- a/apps/web/src/components/settings/SettingsPanels.tsx
+++ b/apps/web/src/components/settings/SettingsPanels.tsx
@@ -472,6 +472,9 @@ export function useSettingsRestore(onRestored?: () => void) {
       ...(settings.diffWordWrap !== DEFAULT_UNIFIED_SETTINGS.diffWordWrap
         ? ["Diff line wrapping"]
         : []),
+      ...(settings.diffIgnoreWhitespace !== DEFAULT_UNIFIED_SETTINGS.diffIgnoreWhitespace
+        ? ["Diff whitespace changes"]
+        : []),
       ...(settings.autoOpenPlanSidebar !== DEFAULT_UNIFIED_SETTINGS.autoOpenPlanSidebar
         ? ["Task sidebar"]
         : []),
@@ -501,6 +504,7 @@ export function useSettingsRestore(onRestored?: () => void) {
       settings.confirmThreadDelete,
       settings.addProjectBaseDirectory,
       settings.defaultThreadEnvMode,
+      settings.diffIgnoreWhitespace,
       settings.diffWordWrap,
       settings.enableAssistantStreaming,
       settings.timestampFormat,
@@ -922,6 +926,32 @@ export function GeneralSettingsPanel() {
           }
         />
 
+        <SettingsRow
+          title="Hide whitespace changes"
+          description="Set whether the diff panel ignores whitespace-only edits by default."
+          resetAction={
+            settings.diffIgnoreWhitespace !== DEFAULT_UNIFIED_SETTINGS.diffIgnoreWhitespace ? (
+              <SettingResetButton
+                label="diff whitespace changes"
+                onClick={() =>
+                  updateSettings({
+                    diffIgnoreWhitespace: DEFAULT_UNIFIED_SETTINGS.diffIgnoreWhitespace,
+                  })
+                }
+              />
+            ) : null
+          }
+          control={
+            <Switch
+              checked={settings.diffIgnoreWhitespace}
+              onCheckedChange={(checked) =>
+                updateSettings({ diffIgnoreWhitespace: Boolean(checked) })
+              }
+              aria-label="Hide whitespace changes by default"
+            />
+          }
+        />
+
         <SettingsRow
           title="Assistant output"
           description="Show token-by-token output while a response is in progress."
diff --git a/apps/web/src/lib/providerReactQuery.test.ts b/apps/web/src/lib/providerReactQuery.test.ts
index 85466326e4..bd1c185868 100644
--- a/apps/web/src/lib/providerReactQuery.test.ts
+++ b/apps/web/src/lib/providerReactQuery.test.ts
@@ -30,6 +30,7 @@ describe("providerQueryKeys.checkpointDiff", () => {
       threadId,
       fromTurnCount: 1,
       toTurnCount: 2,
+      ignoreWhitespace: false,
     } as const;
 
     expect(
@@ -44,10 +45,58 @@ describe("providerQueryKeys.checkpointDiff", () => {
       }),
     );
   });
+
+  it("includes ignoreWhitespace so normal and whitespace-hidden diffs do not collide", () => {
+    const baseInput = {
+      environmentId,
+      threadId,
+      fromTurnCount: 1,
+      toTurnCount: 2,
+      cacheScope: "turn:abc",
+    } as const;
+
+    expect(
+      providerQueryKeys.checkpointDiff({
+        ...baseInput,
+        ignoreWhitespace: false,
+      }),
+    ).not.toEqual(
+      providerQueryKeys.checkpointDiff({
+        ...baseInput,
+        ignoreWhitespace: true,
+      }),
+    );
+  });
 });
 
 describe("checkpointDiffQueryOptions", () => {
-  it("forwards checkpoint range to the provider API", async () => {
+  it("forwards checkpoint range to the provider API by default", async () => {
+    const getTurnDiff = vi.fn().mockResolvedValue({ diff: "patch" });
+    const getFullThreadDiff = vi.fn().mockResolvedValue({ diff: "patch" });
+    mockNativeApi({ getTurnDiff, getFullThreadDiff });
+
+    const options = checkpointDiffQueryOptions({
+      environmentId,
+      threadId,
+      fromTurnCount: 3,
+      toTurnCount: 4,
+      ignoreWhitespace: false,
+      cacheScope: "turn:abc",
+    });
+
+    const queryClient = new QueryClient();
+    await queryClient.fetchQuery(options);
+
+    expect(getTurnDiff).toHaveBeenCalledWith({
+      threadId,
+      fromTurnCount: 3,
+      toTurnCount: 4,
+      ignoreWhitespace: false,
+    });
+    expect(getFullThreadDiff).not.toHaveBeenCalled();
+  });
+
+  it("forwards whitespace-hidden checkpoint range to the provider API", async () => {
     const getTurnDiff = vi.fn().mockResolvedValue({ diff: "patch" });
     const getFullThreadDiff = vi.fn().mockResolvedValue({ diff: "patch" });
     mockNativeApi({ getTurnDiff, getFullThreadDiff });
@@ -57,6 +106,7 @@ describe("checkpointDiffQueryOptions", () => {
       threadId,
       fromTurnCount: 3,
       toTurnCount: 4,
+      ignoreWhitespace: true,
       cacheScope: "turn:abc",
     });
 
@@ -67,6 +117,7 @@ describe("checkpointDiffQueryOptions", () => {
       threadId,
       fromTurnCount: 3,
       toTurnCount: 4,
+      ignoreWhitespace: true,
     });
     expect(getFullThreadDiff).not.toHaveBeenCalled();
   });
@@ -81,6 +132,7 @@ describe("checkpointDiffQueryOptions", () => {
       threadId,
       fromTurnCount: 0,
       toTurnCount: 2,
+      ignoreWhitespace: true,
       cacheScope: "thread:all",
     });
 
@@ -90,6 +142,7 @@ describe("checkpointDiffQueryOptions", () => {
     expect(getFullThreadDiff).toHaveBeenCalledWith({
       threadId,
       toTurnCount: 2,
+      ignoreWhitespace: true,
     });
     expect(getTurnDiff).not.toHaveBeenCalled();
   });
@@ -104,6 +157,7 @@ describe("checkpointDiffQueryOptions", () => {
       threadId,
       fromTurnCount: 4,
       toTurnCount: 3,
+      ignoreWhitespace: false,
       cacheScope: "turn:invalid",
     });
 
@@ -122,6 +176,7 @@ describe("checkpointDiffQueryOptions", () => {
       threadId,
       fromTurnCount: 1,
       toTurnCount: 2,
+      ignoreWhitespace: false,
       cacheScope: "turn:abc",
     });
     const retry = options.retry;
@@ -147,6 +202,7 @@ describe("checkpointDiffQueryOptions", () => {
       threadId,
       fromTurnCount: 1,
       toTurnCount: 2,
+      ignoreWhitespace: false,
       cacheScope: "turn:abc",
     });
     const retryDelay = options.retryDelay;
diff --git a/apps/web/src/lib/providerReactQuery.ts b/apps/web/src/lib/providerReactQuery.ts
index 20007fc8fb..663d618b92 100644
--- a/apps/web/src/lib/providerReactQuery.ts
+++ b/apps/web/src/lib/providerReactQuery.ts
@@ -13,6 +13,7 @@ interface CheckpointDiffQueryInput {
   threadId: ThreadId | null;
   fromTurnCount: number | null;
   toTurnCount: number | null;
+  ignoreWhitespace: boolean;
   cacheScope?: string | null;
   enabled?: boolean;
 }
@@ -27,6 +28,7 @@ export const providerQueryKeys = {
       input.threadId,
       input.fromTurnCount,
       input.toTurnCount,
+      input.ignoreWhitespace,
       input.cacheScope ?? null,
     ] as const,
 };
@@ -36,6 +38,7 @@ function decodeCheckpointDiffRequest(input: CheckpointDiffQueryInput) {
     return Schema.decodeUnknownOption(OrchestrationGetFullThreadDiffInput)({
       threadId: input.threadId,
       toTurnCount: input.toTurnCount,
+      ignoreWhitespace: input.ignoreWhitespace,
     }).pipe(Option.map((fields) => ({ kind: "fullThreadDiff" as const, input: fields })));
   }
 
@@ -43,6 +46,7 @@ function decodeCheckpointDiffRequest(input: CheckpointDiffQueryInput) {
     threadId: input.threadId,
     fromTurnCount: input.fromTurnCount,
     toTurnCount: input.toTurnCount,
+    ignoreWhitespace: input.ignoreWhitespace,
   }).pipe(Option.map((fields) => ({ kind: "turnDiff" as const, input: fields })));
 }
 
diff --git a/apps/web/src/localApi.test.ts b/apps/web/src/localApi.test.ts
index c361cbd787..78e38efa8b 100644
--- a/apps/web/src/localApi.test.ts
+++ b/apps/web/src/localApi.test.ts
@@ -532,6 +532,7 @@ describe("wsApi", () => {
       autoOpenPlanSidebar: false,
       confirmThreadArchive: true,
       confirmThreadDelete: false,
+      diffIgnoreWhitespace: true,
       diffWordWrap: true,
       favorites: [],
       sidebarProjectGroupingMode: "repository_path" as const,
@@ -591,6 +592,7 @@ describe("wsApi", () => {
       autoOpenPlanSidebar: false,
       confirmThreadArchive: true,
       confirmThreadDelete: false,
+      diffIgnoreWhitespace: true,
       diffWordWrap: true,
       favorites: [],
       sidebarProjectGroupingMode: "repository_path" as const,
diff --git a/packages/contracts/src/orchestration.test.ts b/packages/contracts/src/orchestration.test.ts
index 190e09aa63..71781bc847 100644
--- a/packages/contracts/src/orchestration.test.ts
+++ b/packages/contracts/src/orchestration.test.ts
@@ -7,6 +7,7 @@ import {
   DEFAULT_RUNTIME_MODE,
   OrchestrationCommand,
   OrchestrationEvent,
+  OrchestrationGetFullThreadDiffInput,
   OrchestrationGetTurnDiffInput,
   OrchestrationLatestTurn,
   ProjectCreatedPayload,
@@ -22,6 +23,7 @@ import {
 } from "./orchestration.ts";
 
 const decodeTurnDiffInput = Schema.decodeUnknownEffect(OrchestrationGetTurnDiffInput);
+const decodeFullThreadDiffInput = Schema.decodeUnknownEffect(OrchestrationGetFullThreadDiffInput);
 const decodeThreadTurnDiff = Schema.decodeUnknownEffect(ThreadTurnDiff);
 const decodeProjectCreateCommand = Schema.decodeUnknownEffect(ProjectCreateCommand);
 const decodeProjectCreatedPayload = Schema.decodeUnknownEffect(ProjectCreatedPayload);
@@ -57,6 +59,29 @@ it.effect("parses turn diff input when fromTurnCount <= toTurnCount", () =>
   }),
 );
 
+it.effect("parses turn diff input with whitespace ignoring enabled", () =>
+  Effect.gen(function* () {
+    const parsed = yield* decodeTurnDiffInput({
+      threadId: "thread-1",
+      fromTurnCount: 1,
+      toTurnCount: 2,
+      ignoreWhitespace: true,
+    });
+    assert.strictEqual(parsed.ignoreWhitespace, true);
+  }),
+);
+
+it.effect("parses full thread diff input with whitespace ignoring enabled", () =>
+  Effect.gen(function* () {
+    const parsed = yield* decodeFullThreadDiffInput({
+      threadId: "thread-1",
+      toTurnCount: 2,
+      ignoreWhitespace: true,
+    });
+    assert.strictEqual(parsed.ignoreWhitespace, true);
+  }),
+);
+
 it.effect("rejects turn diff input when fromTurnCount > toTurnCount", () =>
   Effect.gen(function* () {
     const result = yield* Effect.exit(
diff --git a/packages/contracts/src/orchestration.ts b/packages/contracts/src/orchestration.ts
index c201d6c82a..a463141fcc 100644
--- a/packages/contracts/src/orchestration.ts
+++ b/packages/contracts/src/orchestration.ts
@@ -1140,7 +1140,10 @@ export const DispatchResult = Schema.Struct({
 export type DispatchResult = typeof DispatchResult.Type;
 
 export const OrchestrationGetTurnDiffInput = TurnCountRange.mapFields(
-  Struct.assign({ threadId: ThreadId }),
+  Struct.assign({
+    threadId: ThreadId,
+    ignoreWhitespace: Schema.optionalKey(Schema.Boolean),
+  }),
   { unsafePreserveChecks: true },
 );
 export type OrchestrationGetTurnDiffInput = typeof OrchestrationGetTurnDiffInput.Type;
@@ -1151,6 +1154,7 @@ export type OrchestrationGetTurnDiffResult = typeof OrchestrationGetTurnDiffResu
 export const OrchestrationGetFullThreadDiffInput = Schema.Struct({
   threadId: ThreadId,
   toTurnCount: NonNegativeInt,
+  ignoreWhitespace: Schema.optionalKey(Schema.Boolean),
 });
 export type OrchestrationGetFullThreadDiffInput = typeof OrchestrationGetFullThreadDiffInput.Type;
 
diff --git a/packages/contracts/src/settings.ts b/packages/contracts/src/settings.ts
index 2b50957a79..7a1451a55d 100644
--- a/packages/contracts/src/settings.ts
+++ b/packages/contracts/src/settings.ts
@@ -34,6 +34,7 @@ export const ClientSettingsSchema = Schema.Struct({
   autoOpenPlanSidebar: Schema.Boolean.pipe(Schema.withDecodingDefault(Effect.succeed(true))),
   confirmThreadArchive: Schema.Boolean.pipe(Schema.withDecodingDefault(Effect.succeed(false))),
   confirmThreadDelete: Schema.Boolean.pipe(Schema.withDecodingDefault(Effect.succeed(true))),
+  diffIgnoreWhitespace: Schema.Boolean.pipe(Schema.withDecodingDefault(Effect.succeed(false))),
   diffWordWrap: Schema.Boolean.pipe(Schema.withDecodingDefault(Effect.succeed(false))),
   favorites: Schema.Array(
     Schema.Struct({
@@ -247,6 +248,7 @@ export const ClientSettingsPatch = Schema.Struct({
   autoOpenPlanSidebar: Schema.optionalKey(Schema.Boolean),
   confirmThreadArchive: Schema.optionalKey(Schema.Boolean),
   confirmThreadDelete: Schema.optionalKey(Schema.Boolean),
+  diffIgnoreWhitespace: Schema.optionalKey(Schema.Boolean),
   diffWordWrap: Schema.optionalKey(Schema.Boolean),
   favorites: Schema.optionalKey(
     Schema.Array(

From 3c726e438520b3c877f292654d138e26d6baef13 Mon Sep 17 00:00:00 2001
From: Illia Panasenko <ilyap@wix.com>
Date: Wed, 29 Apr 2026 21:05:55 +0200
Subject: [PATCH 2/3] default to true + test

---
 .../Layers/CheckpointDiffQuery.test.ts        | 61 +++++++++++++++++++
 .../Layers/CheckpointDiffQuery.ts             |  4 +-
 .../Layers/CheckpointStore.test.ts            |  2 +-
 packages/contracts/src/settings.ts            |  2 +-
 4 files changed, 65 insertions(+), 4 deletions(-)

diff --git a/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.test.ts b/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.test.ts
index 81aa6d563b..645568d734 100644
--- a/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.test.ts
+++ b/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.test.ts
@@ -131,6 +131,67 @@ describe("CheckpointDiffQueryLive", () => {
     });
   });
 
+  it("defaults to hide whitespace changes", async () => {
+    const projectId = ProjectId.make("project-default-whitespace");
+    const threadId = ThreadId.make("thread-default-whitespace");
+    const toCheckpointRef = checkpointRefForThreadTurn(threadId, 1);
+    const diffCheckpointsCalls: Array<{ readonly ignoreWhitespace: boolean }> = [];
+
+    const threadCheckpointContext = makeThreadCheckpointContext({
+      projectId,
+      threadId,
+      workspaceRoot: "/tmp/workspace",
+      worktreePath: null,
+      checkpointTurnCount: 1,
+      checkpointRef: toCheckpointRef,
+    });
+
+    const checkpointStore: CheckpointStoreShape = {
+      isGitRepository: () => Effect.succeed(true),
+      captureCheckpoint: () => Effect.void,
+      hasCheckpointRef: () => Effect.succeed(true),
+      restoreCheckpoint: () => Effect.succeed(true),
+      diffCheckpoints: ({ ignoreWhitespace }) =>
+        Effect.sync(() => {
+          diffCheckpointsCalls.push({ ignoreWhitespace });
+          return "diff patch";
+        }),
+      deleteCheckpointRefs: () => Effect.void,
+    };
+
+    const layer = CheckpointDiffQueryLive.pipe(
+      Layer.provideMerge(Layer.succeed(CheckpointStore, checkpointStore)),
+      Layer.provideMerge(
+        Layer.succeed(ProjectionSnapshotQuery, {
+          getSnapshot: () =>
+            Effect.die("CheckpointDiffQuery should not request the full orchestration snapshot"),
+          getShellSnapshot: () =>
+            Effect.die("CheckpointDiffQuery should not request the orchestration shell snapshot"),
+          getCounts: () => Effect.succeed({ projectCount: 0, threadCount: 0 }),
+          getActiveProjectByWorkspaceRoot: () => Effect.succeed(Option.none()),
+          getProjectShellById: () => Effect.succeed(Option.none()),
+          getFirstActiveThreadIdByProjectId: () => Effect.succeed(Option.none()),
+          getThreadCheckpointContext: () => Effect.succeed(Option.some(threadCheckpointContext)),
+          getThreadShellById: () => Effect.succeed(Option.none()),
+          getThreadDetailById: () => Effect.succeed(Option.none()),
+        }),
+      ),
+    );
+
+    await Effect.runPromise(
+      Effect.gen(function* () {
+        const query = yield* CheckpointDiffQuery;
+        return yield* query.getTurnDiff({
+          threadId,
+          fromTurnCount: 0,
+          toTurnCount: 1,
+        });
+      }).pipe(Effect.provide(layer)),
+    );
+
+    expect(diffCheckpointsCalls).toEqual([{ ignoreWhitespace: true }]);
+  });
+
   it("fails when the thread is missing from the snapshot", async () => {
     const threadId = ThreadId.make("thread-missing");
 
diff --git a/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.ts b/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.ts
index cb1433c21c..c6b1513471 100644
--- a/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.ts
+++ b/apps/server/src/checkpointing/Layers/CheckpointDiffQuery.ts
@@ -24,7 +24,7 @@ const make = Effect.gen(function* () {
   const getTurnDiff: CheckpointDiffQueryShape["getTurnDiff"] = Effect.fn("getTurnDiff")(
     function* (input) {
       const operation = "CheckpointDiffQuery.getTurnDiff";
-      const ignoreWhitespace = input.ignoreWhitespace ?? false;
+      const ignoreWhitespace = input.ignoreWhitespace ?? true;
 
       if (input.fromTurnCount === input.toTurnCount) {
         const emptyDiff: OrchestrationGetTurnDiffResultType = {
@@ -159,7 +159,7 @@ const make = Effect.gen(function* () {
       threadId: input.threadId,
       fromTurnCount: 0,
       toTurnCount: input.toTurnCount,
-      ignoreWhitespace: input.ignoreWhitespace ?? false,
+      ignoreWhitespace: input.ignoreWhitespace ?? true,
     }).pipe(Effect.map((result): OrchestrationGetFullThreadDiffResult => result));
 
   return {
diff --git a/apps/server/src/checkpointing/Layers/CheckpointStore.test.ts b/apps/server/src/checkpointing/Layers/CheckpointStore.test.ts
index e7bb40bc03..16bae3d5c6 100644
--- a/apps/server/src/checkpointing/Layers/CheckpointStore.test.ts
+++ b/apps/server/src/checkpointing/Layers/CheckpointStore.test.ts
@@ -111,7 +111,7 @@ it.layer(TestLayer)("CheckpointStoreLive", (it) => {
           cwd: tmp,
           fromCheckpointRef,
           toCheckpointRef,
-          ignoreWhitespace: false,
+          ignoreWhitespace: true,
         });
 
         expect(diff).toContain("diff --git");
diff --git a/packages/contracts/src/settings.ts b/packages/contracts/src/settings.ts
index 7a1451a55d..1ed312c7b2 100644
--- a/packages/contracts/src/settings.ts
+++ b/packages/contracts/src/settings.ts
@@ -34,7 +34,7 @@ export const ClientSettingsSchema = Schema.Struct({
   autoOpenPlanSidebar: Schema.Boolean.pipe(Schema.withDecodingDefault(Effect.succeed(true))),
   confirmThreadArchive: Schema.Boolean.pipe(Schema.withDecodingDefault(Effect.succeed(false))),
   confirmThreadDelete: Schema.Boolean.pipe(Schema.withDecodingDefault(Effect.succeed(true))),
-  diffIgnoreWhitespace: Schema.Boolean.pipe(Schema.withDecodingDefault(Effect.succeed(false))),
+  diffIgnoreWhitespace: Schema.Boolean.pipe(Schema.withDecodingDefault(Effect.succeed(true))),
   diffWordWrap: Schema.Boolean.pipe(Schema.withDecodingDefault(Effect.succeed(false))),
   favorites: Schema.Array(
     Schema.Struct({

From 27d3b21daec75cf6fa08171b7b8819edf9762aae Mon Sep 17 00:00:00 2001
From: Illia Panasenko <ilyap@wix.com>
Date: Sun, 3 May 2026 14:50:01 +0200
Subject: [PATCH 3/3] fix merge

---
 apps/server/src/checkpointing/Layers/CheckpointStore.ts | 1 +
 1 file changed, 1 insertion(+)

diff --git a/apps/server/src/checkpointing/Layers/CheckpointStore.ts b/apps/server/src/checkpointing/Layers/CheckpointStore.ts
index 94b63a80cf..7efe4cc0a5 100644
--- a/apps/server/src/checkpointing/Layers/CheckpointStore.ts
+++ b/apps/server/src/checkpointing/Layers/CheckpointStore.ts
@@ -269,6 +269,7 @@ const makeCheckpointStore = Effect.gen(function* () {
         toCommitOid,
       ];
 
+      const result = yield* vcs.execute({
         operation,
         cwd: input.cwd,
         args: diffArgs,