Trim the top and root end of the onion. Place the trimmed root end down on a cutting board. Using a sharp knife, make 4 cuts from the top to about 1/2 inch from the root, forming quarters. Then make 4 more cuts in between the first cuts, and continue until you have 12-16 sections. Gently separate the petals.

In a bowl, whisk together the flour, cornstarch, paprika, garlic powder, cayenne pepper, salt, and black pepper. In another bowl, whisk together the milk and egg.

Dip the blooming onion into the milk mixture, ensuring all petals are coated. Let excess drip off. Then, dredge the onion in the dry flour mixture, making sure to get the flour in between all the petals. Shake off any excess.

Preheat your air fryer to 375°F (190°C). Lightly spray the coated onion with olive oil. Carefully place the onion in the air fryer basket. Air fry for 15-20 minutes, flipping halfway through and spraying again with oil, until golden brown and crispy. Cooking time may vary based on your air fryer model.

While the onion is cooking, combine all dipping sauce ingredients in a small bowl and whisk until smooth. Taste and adjust seasonings as needed.

Carefully remove the blooming onion from the air fryer. Serve immediately with the prepared dipping sauce.