In a large microwavable bowl, microwave chocolate chips, peanut butter and butter for 1 minute. Stir mixture until smooth (microwave longer if needed). Stir in the vanilla extract. Add cereal and mix until coated. Allow to cool for 10 minutes.
Spoon cereal mixture into a large plastic bag. Add powdered sugar and shake the sealed bag until coated.
Recipe by Sugar, Spice and Family Life at https://sugarspiceandfamilylife.com/2017/10/muddy-buddies-recipe.html