And the context takes space +kv cache. KV cache drives usefulness as your context grows, it needs to pull the kv cache.
Simplified, the context has to be run on every turn, so the KV cache supplies the processed tokens, so it just needs the new inpute.
I have an RX 6700 XT with 12gb vram and 64gb system ram. running dense models like 27b is difficult, but i can run IQ4/IQ5 qwen 122b-a10b or 35b-a3b at ~20tok/s