01 - Melt butter in a large soup pot over medium heat. Add onion and cook until translucent, about 4 minutes. Add garlic and sauté for 1 additional minute until fragrant.
02 - Add diced potatoes, smoked paprika, and cayenne pepper to the pot. Season with salt and freshly ground black pepper to taste, stirring to coat evenly.
03 - Pour in chicken broth and bring to a boil. Reduce heat to a simmer, cover, and cook for 20 to 25 minutes until potatoes are fork-tender.
04 - Remove approximately one-third of the soup and mash potatoes using a potato masher or blender until smooth. Return the mashed portion to the pot and stir to combine for a thicker consistency.
05 - Stir in whole milk and heavy cream. Heat gently over low until warmed through, being careful not to bring to a boil.
06 - Gradually add shredded sharp cheddar cheese a handful at a time, stirring continuously until each addition is fully melted and incorporated before adding the next.
07 - Remove pot from heat. Stir in sour cream until the mixture is smooth and silky throughout.
08 - Ladle soup into serving bowls. Top each portion with crumbled bacon, sliced fresh chives, and additional shredded cheddar as desired.