Whisk the ketchup, Tupelo honey, apple cider vinegar, water, tomato paste, yellow mustard, and Worcestershire sauce together in a medium saucepan.
Stir in the smoked paprika, chili powder, garlic powder, onion powder, black pepper, cayenne pepper, and kosher salt until evenly combined.
Bring to a gentle simmer over medium heat, then reduce to low and cook, stirring often, until glossy and slightly thickened, 12–15 minutes, or until the sauce coats the back of a spoon.
Remove from heat and whisk in the unsalted butter until melted and the sauce is smooth.
Let cool 10 minutes, then taste and adjust salt if needed. Use warm as a glaze or dip, or cool completely and refrigerate in a sealed jar for up to 2 weeks. For grilling, brush on during the last 5–10 minutes of cooking to prevent burning.