add 1 tablespoon oil, bread, and hazelnuts to 12-inch nonstick skillet and cook over medium heat, stirring constantly, until bread and hazelnuts are lightly toasted, about 3 minutes. Add garlic and cook, stirring constantly, until fragrant, about 30 seconds.

Transfer bread mixture to food processor and pulse until coarsely chopped, about 5 pulses. Add red peppers, vinegar, honey, paprika, salt, cayenne, and remaining 1 tablespoon oil to processor. Pulse until finely chopped, 5 to 8 pulses. Transfer sauce to bowl and set aside for serving. (Sauce can be refrigerated for up to 2 days.)