Place potatoes, onions, carrots, cashews and water into Instant Pot inner pot.
Cover with lid, turn lid clockwise to lock into place. Align the pointed end of the steam release handle to point to “Sealing.” Press "Manual", use [-] button to adjust cooking time to 2 minutes.
When the cooking time is complete, press "Keep Warm/Cancel" once to cancel the keep warm mode then wait 10 minutes for the pressure to go down.
Carefully turn the steam release handle to the “Venting” position to release remaining pressure. When the float valve drops down. Remove lid.
Use a slotted spoon to transfer vegetables mixture and cooking liquid to a blender.
Add nutritional yeast, mustard, lemon juice, salt and liquid smoke; blend on high until smooth and creamy, 1 minute. If you want a thinner consistency, add up to 1/3 cup nondairy milk.
Sauce will continue to thicken with or without the addition of nondairy milk. Enjoy!