This probably took all of half an hour tonight. I traced the letters (backward) onto the wrong side of Heat-n-Bond, then fused that block to the back of some fabric I took from a pair of Thing 1's pants. (They had gotten a hole in the knee last fall, and I hadn't repaired them. Now that he's grown, I thought it made more sense to cut them off and remake them as shorts.) I then cut them out and fused the (right way) onto a towel that I found in my sewing supplies. (I think I had bought this to make more hooded towels, but it hadn't been used yet.) Then I satin-stitched around the edges. By the way, this towel is actually navy blue, and the stitching is a bright green.
I'm pretty happy with how this turned out, and I know that it won't disappear. :)