Scrub and rinse potatoes, leaving skins on. Using a box grater or food processor to shred potatoes and set aside. Shred 1/2 yellow onion and add to potatoes in cheesecloth or paper towels.
Wring out excess water over a large bowl, removing as much moisture as possible. Pour liquid from bowl, maintaining the potato starch from the bottom of the bowl. Add potato and onion shreds to the bowl with starch.
Stir in egg, breadcrumbs, salt and pepper. Use your hands, if needed, to incorporate the ingredients until well combined.
In a large skillet over high heat, add vegetable oil. Once oil is hot, drop latke mix in using a 1/4 cup measuring cup. Smash down with a fork or fish spatula. Fry for 4 to 5 minutes per side, until extra crispy.
Transfer latkes to a cooling rack over a sheet pan and keep warm in oven preheated to 200 degrees while you continue to fry the remaining latkes. Serve warm with sour cream and applesauce.