Measure the Rice Chex cereal into a large bowl and set it aside.

In a microwave-safe bowl, combine the white chocolate chips and peanut butter.

Microwave on high in 30-second intervals. Stir after each interval until the mixture is fully melted and smooth (about 60–90 seconds total depending on your microwave).

Stir in the peppermint extract until evenly incorporated.

Pour the melted chocolate-peanut butter mixture over the cereal. Gently fold with a spatula until all pieces are coated. Work quickly before the chocolate firms.

Transfer the coated cereal into a large zip-top bag. Add the powdered sugar, seal the bag, and shake vigorously until every piece is dusted.

Spread the puppy chow out on a baking sheet in a single layer to cool and set for 10–15 minutes.

Once cooled, sprinkle with crushed peppermint candies and optional red and green sprinkles. Toss lightly so the candy clings.

Store in an airtight container for up to 5 days at room temperature, away from heat and direct sunlight.

Not necessary to refrigerate; can introduce moisture. Refrigerate only in very warm climates.

Freeze in an airtight, freezer-safe bag for up to 1 month. Thaw at room temperature for 30–60 minutes before serving.