Preheat oven to 350 degrees.
1. Butter and flour 2 9-inch cake pans.
2. In a medium saucepan, heat 1/2 cup of the milk and the grated chocolate. Stir until chocolate is melted. Set aside to cool then add the vanilla.
3. Cream butter and sugar using an electric mixer. Separate the eggs. Keep the whites in a mixing bowl, and stir the yolks into the butter-sugar mixture, and beat until mixture is light and fluffy. Stir the baking soda into the remaining 1/2 cup milk. Whisk into the butter-sugar mixture until creamy.
4. Combine flour and baking powder in a bowl.
5. Beat the egg whites in an electric mixer until they hold stiff peaks. Fold the egg whites alternately with flour into the butter mixture. Finally fold in the melted chocolate-milk mixture. Pour half of the batter into each of the two prepared pans. Bake for 30 minutes or until the center springs back when pressed lightly.