Pour ½ cup of the water into a small bowl. Sprinkle the gelatin powder into the water; stir, then set aside.

Very carefully, pour the hot candy mixture into a large mixing bowl. Safety note: be extremely cautious to not splash the very hot candy onto your skin!

Add the gelatin and water mixture to the candy. Beat the candy with an electric mixer (a stand mixer is preferable if possible), starting on low speed and gradually increasing the speed to high as the mixture thickens. When the marshmallow has thickened and turned white, add the vanilla extract. Continue to beat the marshmallow on high speed until it has more than doubled in volume.

Prepare an 11x7 inch glass dish by completely covering the bottom and sides with powdered sugar. Use your fingers to press the powdered sugar up the sides of the pan. You’ll want every bit of the pan to be coated in powdered sugar so that the marshmallow does not stick.

Scoop the marshmallow into the pan prepared with the powdered sugar. Use a lightly oiled spoon to smooth the marshmallow out, then sprinkle the top of the marshmallow generously with powdered sugar.

Place the pan of marshmallow in a cool, dry area to set for 8 hours.

Cut the marshmallow lengthwise into 5 long strips, then cut each strip into 10 pieces to create a total of 50 marshmallow squares. Roll each marshmallow in powdered sugar.

Store marshmallows at room temperature in an airtight container.