Heat the olive oil in a large pot or Dutch oven over medium heat. Add the chopped onion and cook until translucent, about 5 minutes. Stir occasionally.
Add the minced garlic and chopped red bell pepper to the pot. Cook for another 3-4 minutes until the bell pepper softens.
Stir in the diced butternut squash, ground cumin, chili powder, smoked paprika, salt, and pepper. Cook for about 2 minutes to toast the spices.
Pour in the diced tomatoes (with their juices), black beans, kidney beans, and vegetable broth. Stir everything well to combine.
Bring the mixture to a simmer, reduce the heat to low, and cover the pot. Let it cook for 25-30 minutes, or until the butternut squash is tender.
Taste the chili and adjust seasoning if necessary. If you prefer a thicker chili, let it simmer uncovered for an additional 5-10 minutes.
Serve hot, garnished with optional toppings such as avocado, cilantro, or a dollop of sour cream.