Line an 8 x 8-inch baking dish with parchment paper. Lightly grease with butter. Combine the butter and peanut butter in a microwave safe bowl and cover with plastic wrap. Microwave on full power for 2 minutes. Remove from the microwave, stir, and microwave on full power for 2 minutes more.
Carefully remove the bowl from the microwave. Add the vanilla and confectioners’ sugar to the bowl. Stir with a wooden spoon or spatula until evenly combined. The mixture will become difficult to stir and lose its sheen.
Transfer the mixture to the prepared pan and spread into an even layer. Place an additional piece of parchment directly on the surface of the fudge. Refrigerate until cool, at least 2 hours. Use a large knife to cut into 1-inch pieces. Store in an airtight container at room temperature for up to 1 week.