Spray an 8-inch square baking pan with cooking spray.
Mix cold water and gelatin together in a bowl until gelatin is dissolved.
Bring 3/4 cup water to a boil in a saucepan; add sugar and bring back to a boil. Pour sugar mixture over gelatin mixture; add vanilla extract and salt. Beat with an electric mixer until fluffy, about 20 minutes.
Spread mixture in the prepared baking pan; chill in the refrigerator for 8 hours to overnight.
Cut marshmallows into squares with a knife dipped in hot water. Press squares into the toasted coconut.