• Preheat the air fryer to 325 degrees F. 

Make the Donuts:

• While the air fryer is preheating, prepare the biscuits. Start by using a 1 inch round biscuit cutter or the large end of a piping tip to cut a small 1 inch round hole in the center of the biscuit. Repeat this step on all of the biscuits. You may discard the donuts holes.  
• Next, line a baking sheet with a layer of parchment paper. Then on top of the parchment paper, place a cooling rack. This will catch the excess icing while it sets on the donuts later in the process. Set aside. 
• Once the air fryer is preheated, spray the bottom of the air fryer basket with a light coating of cooking spray and place biscuits in the basket. Cook for 3 minutes and then flip and air fry for an additional 2 minutes or until slightly golden brown. Exact air fryer times will vary based on size and model.
• Repeat this step until all the donuts are baked. Place the lightly golden brown donuts on the prepared cooling rack to cool.  

Make the Glaze:

• Next, use a medium-large saucepan over medium heat to gently melt 3 tablespoons of unsalted butter. Once the unsalted butter is melted, quickly reduce the heat to low and add 7 cups of mini marshmallows.
• Stir the mini marshmallows and butter together until combined and the mini marshmallows are completely melted. You should not see lumps in the marshmallows. Remove from heat.
• Next, gradually blend in 1 ½ cups of sifted powdered sugar into the marshmallow mixture. Continue to blend together until all of the ingredients are combined. There may be some powdered sugar stuck to the sides.
• Gradually add in ⅛ cup of milk to thin the mixture and to remove most of the remaining powdered sugar from the sides. Continue to blend the icing until it has a smooth and ice-like texture.  

Glaze and Decorate the Donuts:

• Then using a pair of tongs, dip each donut into the warm marshmallow icing taking care to only dip the tops of the donut. Allow the freshly iced donuts to cool and drip while they are on the cooling rack. 
• Once all of your donuts are iced, carefully place Lucky Charms marshmallows onto the wet glaze. Add golden sparkle sprinkles if using.
• Allow to cool and set on the cooling rack for at least 15 minutes before serving.