01 - In a medium saucepan over medium-low heat, combine the softened cream cheese and whole milk. Stir continuously with a whisk or wooden spoon until the mixture is completely smooth and the cream cheese has fully melted, approximately 3 to 4 minutes.
02 - Add the shredded cheddar cheese in three small handfuls, stirring constantly after each addition. Continue stirring until each portion is fully melted and the mixture becomes silky and uniform before adding the next handful.
03 - Stir in the garlic powder, onion powder, smoked paprika, black pepper, cayenne pepper if using, and salt. Continue heating gently for 2 to 3 minutes while stirring frequently to prevent the bottom from scorching and to allow the flavors to meld together.
04 - Remove the saucepan from heat and carefully pour the dip into a warm serving bowl. Sprinkle the chopped chives or green onions over the top for a fresh finish and a pop of color.
05 - Serve immediately while warm alongside tortilla chips, crusty bread, breadsticks, or an assortment of fresh cut vegetables such as celery, bell peppers, and carrot sticks.