In a medium to large-sized bowl, sprinkle the gelatin over the cold water. Allow to sit for at least 5 minutes.
In a heavy bottom sauce pan, stir sweeteners and remaining (hot) water.
Heat sweeteners and water over high heat until the mixture reaches 240 - 245 °F, or the soft ball stage.
Gradually (and carefully :-)!), while mixing constantly, add the hot mixture to the water and gelatin mixture.
Slowly add the vanilla to the mixture while beating.
Beat on high until the mixture form stiff peaks (almost like beaten egg whites).
Pour into a lightly greased 8x8 pan. You can use whatever size pan you like to make either thick or thin marshmallows. The 8x8 pan will make pretty nice-sized thick marshmallows.
Allow marshmallow to set. Then cut into desired sized. This can take 6-24 hours (I've never had it take that long), but you can put them in the freezer to speed it up -- just don't forget they're in there :).
If desired, coat with cocoa, raw or toasted coconut, ground up nuts - have fun with your toppings!
Store in an airtight container and try to keep your kiddos out of them!
Notes
Vegan Option: For a vegan marshmallow option, use agar powder in a 1:1 substitution for the gelatin. If you are attempting to make a vegan option, be aware that you might have varying results. You do need to let the agar sit on the water for about 1 hour before using it. Also, the results with agar can be variable so please be aware. I am going to try to do some experimenting to see if I can figure out what makes them work vs. not work.
Xylitol: Any other healthy sweetener can be used instead of xylitol, but if using erythritol use 1/3 more. If using a liquid sweetener, you may need to use a different amount, so read How to Substitute Sweeteners first. Approx. 12 scoops (3/8 of a teaspoon) of stevia (see How to Use Stevia) will work. Use honey, maple syrup (read this post for help choosing maple syrup), coconut sugar, or sucanat for AIP.
Glycerine: You can also substitute any healthy sweetener for glycerine. Again, though, if using a granulated sweetener a different amount may need to be used. If you’re on the THM diet, use xylitol or erythritol – again, use 1/3 more if using erythritol.
Roasting Tips: Homemade sugar-free marshmallows simply don't roast well. However, if you'd like to try it, you can let them dry for a few days before roasting and use just quick bursts of heat. I haven't tried this yet but I read it should work. It's likely that allulose will work best for this.