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Preheat the oven to 350 degrees F. Line a standard 12-cup muffin pan with paper liners and set aside.
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In a medium bowl, add the flour, baking powder, and salt. Whisk to combine.
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In a large bowl, add the butter and 1 cup sugar. Beat using an electric mixer on high speed until light and fluffy, about 5 minutes. Scrape down sides of bowl as needed. Add the vanilla and coconut extracts and beat to combine. Add the flour mixture in three additions, alternatively with the coconut milk in two additions, mixing on low speed until just combined. Do not over mix.
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In another large bowl, beat the egg whites using an electric mixer with a whisk attachment on low speed until foamy. Increase the speed to high and gradually add the 2 tablespoons of sugar. Beat until stiff and glossy peaks form, about 5 minutes. Do not overbeat.
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Gently fold a third of the egg whites into the batter until combined. Gently fold in the remaining egg whites into the batter until combined. Be careful not to deflate the egg whites too much. Stir in the coconut flakes.
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Divide the batter evenly among the muffin cups, filling them about 2/3 to 3/4 full (about 1/4 cup batter per muffin cup). Bake for 20 to 25 minutes, or until cupcakes are lightly golden brown and a toothpick or cake tester inserted in the center of the cupcake comes out clean. You can rotate the cupcakes halfway through baking for even browning.
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Remove cupcakes from the pan and cool completely on a wire rack. Frost with seven minute frosting. Garnish with coconut flakes. Optional additional garnishes are edible flowers or candy.