In a medium saucepan, whisk together the ketchup, water, apple cider vinegar, dark brown sugar, molasses, Worcestershire sauce, and yellow mustard until smooth.
Whisk in the chili powder, smoked paprika, onion powder, garlic powder, black pepper, cayenne pepper, and kosher salt.
Bring to a gentle simmer over medium heat, then reduce to low and cook uncovered, stirring occasionally, 15–20 minutes, until glossy and thick enough to coat the back of a spoon.
Remove from heat and let cool 10 minutes. For an extra-smooth texture, blend with an immersion blender until velvety.
Use warm or cool completely. Transfer to a clean jar, cover, and refrigerate for up to 2 weeks.