Gather the ingredients including cake flour, baking powder, salt, unsalted butter, granulated sugar, eggs, coconut milk, vanilla extract, and shredded coconut (sweetened or unsweetened).
Preheat your oven to 350°F (175°C) and grease and flour two 9-inch round cake pans.
In a medium bowl, whisk together the cake flour, baking powder, and salt until well combined. Set aside.
In a large bowl, cream together the unsalted butter and granulated sugar until light and fluffy using a hand mixer or stand mixer.
Beat in the eggs, one at a time, then stir in the vanilla extract until smooth and creamy.
Gradually add the dry ingredients to the butter mixture, alternating with the coconut milk. Begin and end with the dry ingredients, mixing until just combined.
Gently fold in the shredded coconut until evenly distributed throughout the batter.
Divide the batter evenly between the prepared cake pans and smooth the tops with a spatula. Bake in the preheated oven for 25 to 30 minutes, or until a toothpick inserted into the center comes out clean.
Allow the cakes to cool in the pans for 10 minutes, then remove them from the pans and transfer to a wire rack to cool completely. Once cooled, frost the cake with your favorite coconut frosting and sprinkle with additional shredded coconut on top, if desired.