Preheat oven to 350°F. Line three 6-inch round cake pans with parchment paper. Grease lightly and set aside.
Whisk together flour, baking powder, and salt. Set aside. In the bowl of a stand mixer fitted with a paddle attachment, combined cooled melted butter, coconut oil, and sugar. Add eggs and beat until mixture is pale in color. Scape down bowl as needed to ensure thorough mixing.
Alternate adding flour mixture and coconut milk, beginning and ending with the flour. Mix on low speed until combined. Fold in rainbow confetti.
Divide batter among the three prepared cake pans. Level batter and bake for 35-40 minutes until the cakes are golden brown and a toothpick inserted in center of cake comes out clean. Let cool in pan for 5 minutes before unmolding. Allow to cool to room temperature on wire rack.
Coconut Buttercream:
In the bowl of a stand mixer fitted with a paddle attachment, beat butter until smooth. Add powdered sugar, salt, and coconut milk. Mix on low speed until buttercream is smooth. Scrape down bowl as needed to ensure thorough mixing. Increase speed to medium and beat until buttercream is airy, smooth, and creamy. Transfer buttercream to a piping bag fitted with a medium star tip.
Assembly:
If necessary, level cake layers. Place one cake round on cake stand, or serving dish of choice. Pipe little star spikes all over the surface of the cake layer. Top with a second cake round. Repeat filling cake surface with buttercream. Place final third layer on top and pipe buttercream on top. Sprinkle a handful of confetti over the top of the cake.
If serving immediately, let cake stand out at room temperature until ready to serve. Otherwise, keep stored in the fridge in an airtight container. Allow to come to room temperature before serving.
Notes
Be sure to use canned full-fat coconut milk. Other coconut milks (low-fat and those found in the refrigerated dairy section) will not produce the same full coconut flavor.
Add another 1/4- 1/2 cup confectioners' sugar if buttercream is too thin.