Preheat the oven to 350°F. Butter an 8x8-inch baking pan. Line the bottom with parchment paper and butter the paper.

Place the pistachios and lemon zest in the bowl of a food processor and pulse until finely ground (but not to pistachio butter). Pour mixture into a bowl along with flour, baking powder and baking soda. Whisk to combine, then set aside.

In a small bowl, whisk to combine sour cream, vanilla and milk and set aside.

In the bowl of a stand mixer fitted with a paddle attachment, cream butter, sugar and salt on medium speed until light and fluffy, about 3 minutes.

Add eggs, one at a time, until fully incorporated. Scrape down sides and bottom of bowl as needed.

With the mixer on low, alternate adding the dry ingredients (in three additions) and wet ingredients (in two additions), starting and ending with the dry.

Pour batter into prepared pan and smooth the top. Bake for 35-40 minutes, or until a toothpick inserted in the center comes out clean. Cool in the pan for about 10 minutes. Carefully turn cake out onto a work surface, peel off parchment paper, then invert onto a wire rack to cool completely.

Spread with frosting, sprinkle with chopped pistachios and serve at room temperature.

Combine all frosting ingredients in a medium bowl. Use a hand mixer fitted with beater attachments to mix until smooth. Be very careful not to over mix, the frosting can curdle.