Start by preheating your oven to 350°F (or 320°F if using a convection/fan oven). While it heats, sift together the coconut flour to break up any lumps—this prevents grittiness in the final texture. Measure out all your ingredients so everything is ready when you need it. I like to sift the coconut flour even though it seems extra because it truly makes the difference between smooth cookies and ones with an unpleasant grainy texture.
In a medium bowl, combine the sifted coconut flour, almond flour, powdered erythritol, baking powder, and xanthan gum. Whisk these together thoroughly to distribute the leavening agents and xanthan gum evenly throughout the dry mixture. This ensures your cookies will have a consistent texture and rise properly during baking.
In a separate bowl, combine the softened butter, melted and cooled coconut butter, and almond extract. Blend these together until smooth and well combined. Then, fold in the dry ingredient mixture from Step 2 until a cohesive dough forms—don't overmix, as this can make the cookies tough. The dough should come together easily but still be workable.
Divide the dough into 2 equal portions. Place each portion between two sheets of parchment paper and roll flat to about 1/4-inch thickness. Transfer the rolled dough (still between the parchment) to the refrigerator for 20 minutes, or to the freezer for 10 minutes if you're short on time. Chilling prevents the dough from spreading excessively during baking and helps maintain the crisp, shortbread texture. Once chilled, remove from the fridge and use cookie cutters to cut out shapes. Place the cut cookies onto a parchment-lined baking sheet, spacing them about an inch apart.
Place the baking sheet in your preheated oven and bake for 6 minutes, watching carefully until the edges just begin to turn golden brown. The cookies will continue to firm up as they cool, so don't overbake them or they'll become too crispy. Remove from the oven and let the cookies cool on the baking sheet for a few minutes before transferring to a wire rack to cool completely.
While the cookies cool, warm the remaining coconut butter in a small saucepan over low heat or in the microwave for 20-30 seconds until it's just pourable. Stir in the powdered erythritol (2.5 tsp) until smooth and combined. Once the cookies have cooled completely, drizzle the glaze over each cookie with a fork or small spoon, then let it set at room temperature for about 10 minutes. I find that letting the glaze set at room temperature rather than chilling gives a nicer, less waxy finish on these delicate cookies.