Fluorescent Carbon Quantum Dots (FCQDs), a new generation of carbon nanomaterials, have attracted a lot of attention throughout the years. This paper applied a straightforward and environmentally beneficial way to create water-soluble FCQDs hydrothermally from coconut shells. The as-prepared FCQDs have desirable functional groups and exhibit strong blue-emitting fluorescence with a relative quantum yield of 0.6 and 0.7%. The optical bandgap of FCQDs is calculated using UV–Vis spectra to be between 3.9 and 4.4 eV. Optical studies show that FCQDs have good fluorescence properties when excited at 360 nm. Whereas the fluorescence decay lifetime using TCSPC are 1.6–0.99 ns. The synthesized FCQDs were found by HRTEM to have a spherical shape and a particle-size distribution of 2.8–5.4 nm. As-prepared FCQDs has a very low hemotoxicity of 0.5 to 1.3%, which indicates that they have acceptable biocompatibility and are not hazardous. According to the DPPH antioxidant data, FCQDs had a stronger antioxidant activity compared to earlier reports. These important characteristics enable its applications in biomedical, food packaging, fluorescence imaging, photocatalysis, and sensing. The enhanced antioxidant characteristics of the produced FCQDs make them appropriate for use in biomedical, bioimaging, chemical, and industrial applications. The as-synthesized FCQDs were used for the detection of ferric ions with good selectivity.