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Place grated potatoes between several sheets of paper towels, press to remove some of the moisture. In a bowl, combine the grated potato, egg, masa, salt, pepper, cayenne and onion powder, mix until combined.
Heat olive oil over medium high heat until hot but not smoking. Form potatoes into silver dollar sized pancakes about 1/4 inch thick. Add to the pan and cook until browned, about 2 minutes, then flip pancake. Top the pancakes with a small amount of cheddar cheese, cook until cheese is melted and underside of the pancake is browned, about an additional 3 minutes. Remove from pan and allow to drain on a paper towel.
In a bowl, combine the sour cream, jalapenos and smoked paprika, mix. Top the potato pancakes with sour cream. Serve warm.
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