In a large pot over medium heat, add diced bacon and cook for about 5–7 minutes until crispy. Remove the bacon with a slotted spoon, letting it drain on paper towels.

In the same pot with the bacon drippings, add diced potatoes and pour in enough broth to cover them. Bring to a gentle boil, then reduce to a simmer for 15–20 minutes until fork-tender.

Carefully use an immersion blender to blend a portion of the soup for a creamy yet chunky texture, ensuring some potato chunks remain.

Lower the heat and stir in the cheddar cheese and sour cream. Mix well for about 2–3 minutes until melted and combined.

Taste and season with salt and pepper to your liking.

Ladle the warm soup into bowls and sprinkle with reserved crispy bacon bits and chopped chives.