Dissolve yeast and sugar in 1/4 cup warm water. Let rest until foamy, about 15 minutes.
Add flour, salt, 1 cup of water, dissolved yeast and softened butter to the bowl of a large mixer with a dough hook attachment. Set the mixer on low. Mix until dough is elastic, about 8 minutes. If the dough is too dry, add 1/4 cup of water, a tablespoon at a time. Remove hook. Let dough rest in the bowl for about 30 minutes.
Pinch off dough into 12 equal pieces. Roll each piece between the palms of your hands to form a 22" rope. Make a U shape with dough, cross the ends over each other, twist twice, then lay ends on sides of the U. Place pretzels on a baking sheet. Refrigerate for one hour.
Preheat oven to 425 degrees. Line a baking sheet with parchment paper or sprinkle with coarse salt. Dissolve baking soda in 1 quart of boiling water. The water will rise and fizz as the baking soda and water mix. Place each pretzel in boiling water for 30 seconds. This process helps give the pretzel a crispy outer shell. Remove with slotted spoon and sprinkle with coarse salt. Place on prepared baking sheet. Bake pretzels for 14-18 minutes or until brown.