Bring ¾ cup water to a simmer in a medium saucepan over medium-high heat. Whisk in 3 Tbsp. cocoa powder until no lumps remain, then add milk and return to a simmer. Whisk in chocolate and sugar and cook, whisking frequently, until mixture is smooth and creamy and chocolate is melted, about 5 minutes.
Divide hot chocolate among mugs. Top with whipped cream and dust with cocoa powder.
3 tablespoons cocoa powder (preferably Dutch-processed), plus more for serving
3 cups whole milk
6 ounces semisweet chocolate (preferably Scharffen Berger), finely chopped
3 tablespoons demerara or granulated sugar
Lightly sweetened whipped cream (for serving)