In a small bowl, whisk together the coconut flour, salt, and pepper; set aside.
In another small bowl, beat together the eggs and water; set aside.
In yet one more small bowl, mix together the shredded coconut and Panko bread crumbs.
Dredge one shrimp in the coconut flour mixture, then dip into the egg mixture. Then dredge the shrimp in the coconut coating, pressing it onto the shrimp so it sticks well. Repeat this process with all of the shrimp.
In a large skillet, add the oil to 1-inch depth and heat over medium to medium-high heat until a piece of the coconut shrimp sizzles when added to the oil. Fry the shrimp in small batches for about 1 minute per side until golden brown. Remove the shrimp and place on paper towels or a wire cooling rack.
In a small bowl, mix together the ingredients for the sauce.
Serve the shrimp hot with the dipping sauce.
Notes
The shrimp can be baked instead of fried by baking at 425°F for about 10-12 minutes, flipping once during baking. They will be much crispier if fried.You could also prepare the shrimp in the coating and freeze in a single layer to fry or bake later.