In a small saucepan over high heat, pour the coconut milk. When it reaches a gentle simmer, add the red curry paste, peanut butter, garlic, lime juice, sugar, and fish sauce. Whisk and continue to cook over high heat for about 15 minutes or until the sauce has thickened and reduced.

Add the crushed peanuts and simmer for another 5-10 minutes. When the sauce coats the back of a spoon, add small amounts of water or broth and whisk until the sauce reaches the desired consistency. If the sauce separates, whisk it vigorously until smooth.

Garnish with crushed peanuts or scallions. Enjoy over rice, noodles, or mashed potatoes, or use as a base for your favorite curry dish.