This tutorial is for a 16 oz Dixie paper cup, but this can be used for any paper cup.
Carefully cut open the paper cup and remove the bottom. This will be your template.
Use the paper cup template on the wrong side of the fabric. I found it easier to draw around the template, but if you prefer to pin the template to the fabric, then do so. Use whichever method is easier for you.
Use the template to:
Cut 1 piece from the fabric for the outside (add seam allowance).
Cut 1 piece from the fabric for the inside lining (add seam allowance).
Cut 1 piece of batting (do not add seam allowance to reduce bulk).
Lay the batting on the wrong side of the outside fabric. Position so it is centered on the fabric.
Pin or glue baste in place.
Quilt the batting in place. The more quilting that you do, the stiffer the piece will be.
Now lay the quilted outside piece onto the inner lining, right sides together.
Stitch the top and bottom of the wrap using the batting as a guide. If you did not include a seam allowance on the batting, then it will be the size of the paper cup.
Trim away excess fabric to reduce bulk.
Turn the tube inside out. Align the open ends with the right side out (we are creating a French seam so there are no raw edges when finished).
Stitch together and trim close to the stitching line. Then turn so the wrong side is out and sew the seam again. This hides the raw edge. Then turn so the right side is out again.
You should have a finished paper cup holder to prevent your hands from burning and to help keep your drink warm longer.