Peel and cube the russet potatoes into roughly 1-inch pieces.

Finely dice the yellow onion and mince the garlic.

In a large pot or Dutch oven, melt butter over medium heat. Add the chopped onion and cook until soft and translucent for about 5-7 minutes, stirring occasionally.

Add the minced garlic and cook for another minute until fragrant.

Add the cubed potatoes, chicken broth, and water to the pot. Mix in the salt, pepper, smoked paprika, and cayenne pepper (if using). Bring to a boil, then reduce heat to low, cover, and simmer for 15-20 minutes, or until the potatoes are very tender.

Remove the pot from the heat. Using an immersion blender, blend the soup until smooth. Alternatively, carefully transfer the soup to a regular blender in batches (be cautious of hot liquids) and blend until smooth. Return to the pot.

Put the pot back on low heat. Stir in the heavy cream and sour cream. Heat gently, being careful not to boil.

Taste the soup and adjust the seasoning as needed.

Cook bacon until crispy, drain, and crumble. Shred the cheddar cheese and chop the green onions.

Ladle the hot potato soup into bowls. Top with crumbled bacon, shredded cheddar cheese, and chopped green onions. Serve immediately.