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Heat the oil in a large (3- or 4-quart) straight-sided saute pan over medium-high heat. Add the chicken thighs and brown on all sides, cooking 2-3 minutes per side.
While the chicken thighs brown, remove the tough outer layers and tips of each lemongrass stalk and cut the inner green stalk into 5-inch lengths. Smash the lemongrass roughly with a meat tenderizer to bruise the stalks.
Remove the browned chicken from the pan and lower the heat to medium-low. Add the lemongrass, garlic, ginger, and chili pepper and cook, stirring, for 1 minute. Stir in the cashews and cook to lightly brown the nuts.
Return the chicken to the pan. Add the coconut milk and bring to a simmer. Cover and cook for 40 minutes or until the chicken thighs fall off the bone (if bone-in) or separate easily with a fork (if boneless).