In a large microwave-safe bowl, combine the peanut butter and butter. Microwave on high for 1 minute, stir, then microwave in 30-second intervals, stirring after each, until smooth and fully melted. Stir in the vanilla extract.

Gently pour the melted peanut butter and chocolate mixture over the Chex cereal in a very large bowl. Toss carefully with a spatula until the cereal is evenly coated. Be gentle to avoid breaking the cereal pieces.

In a large zip-top bag or a clean bowl, add the powdered sugar. Add the coated cereal mixture to the bag (or bowl). Seal the bag and shake gently (or toss in the bowl) until the cereal is thoroughly coated with powdered sugar.

Spread the coated cereal in a single layer on parchment paper or wax paper to cool and set completely. This prevents clumping and ensures a crispy texture.