In a large mixing bowl, add the shrimp, egg, milk, hot sauce and seasonings (paprika, garlic powder, onion powder, salt, black pepper, and cayenne pepper). Thoroughly mix ingredients together to combine. Cover the bowl and refrigerate for 40 to 60 minutes. Remove the marinaded shrimp from the fridge about 10 to 15 minutes before dredging and frying.
In a small saucepan under medium heat, melt the butter. Add in the hot sauce, honey, paprika and cayenne pepper. Whisk ingredients together to combine and bring the mixture to a low simmer. Cook the sauce for 3 to 4 minutes to thicken slightly. Remove the pan from the heat and set aside to cool the sauce to room temperature.
In a large mixing bowl, add in the flour, cornstarch and seasoning (paprika, garlic powder, onion powder, salt, black pepper, and cayenne pepper). Whisk well to combine. Drizzle some of the liquid marinade into dredge mixture, about 2-3 spoonful, and mix to create a crumbly consistency (optional but recommended). Add a few of the marinaded shrimp into the bowl with the dredge mixture. Thoroughly coat and transfer to a parchment lined baking sheet. Repeat process until all of the shrimps are coated.
Heat up oil in a large frying pan to 350F. In batches consisting of 6 to 8 shrimps, fry the shrimps, flipping half way through cook time, for about 4 to 5 minutes or until fully cooked and golden brown. Transfer to a paper towel lined baking sheet or large plate to remove any excess oil.
Transfer the fried shrimps into a large mixing bowl, pour over about two-thirds of the hot honey sauce and gently shake the bowl to coat the shrimps in the sauce. Alternatively, use a pastry brush to coat both sides of the shrimp in the hot honey sauce.
Serve hot honey fried shrimp as is with any remaining hot honey sauce or with your favorite side and sauce for dipping.