Preheat your oven to 350°F (175°C) and grease and flour two 9-inch round cake pans.
In a bowl, cream the softened butter and sugar together until light and fluffy.
Add eggs one at a time, mixing well after each addition.
Stir in the vanilla extract and coconut milk.
In another bowl, combine flour, baking powder, salt, and shredded coconut.
Gradually add the dry ingredients to the wet mixture, mixing until just combined.
Divide the batter evenly between the prepared pans.
Bake for 30-35 minutes or until a toothpick comes out clean.
Let the cakes cool in the pans for 10 minutes, then transfer to wire racks to cool completely.
Frost with the whipped cream and powdered sugar mixture once cooled.