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Warm the milk and chocolate chips in a pan over a low/medium heat until the chocolate melts, whisking often.
Whisk in the water, honey, cinnamon and vanilla.
Cut the chili in half, remove and discard the seeds, then add the chili to the pot. Allow the mixture to nearly come to the boil, then remove from the heat.
Allow the mixture to sit for 10 minutes to infuse the flavors. Taste during this time and remove the chili if it’s getting too spicy, and add more sweetener if desired.
Serve warm or cold.