Use this water proof adhesive to secure the insert into the second cup. Wait 24 hours for the adhesive to cure then test the cup to be sure that no water leaks into the smaller section. That's all the preparation needed. If you take care of the gimmicked cup in your travels, it'll last a very long time. That's enough powder needed to solidify half a cup of water.
Accordion pleat a white silk handkerchief and place it in the smaller section of the cup.
The reason for doing it this way is that you want a wider opening to pour the liquid in. Place this cup inside your case or on your table. This doesn't have to be an opening effect, it can sit in your case until needed. Although what better opener than to produce a silk handkerchief which you can then use for any other effect with a handkerchief. I use this as part of a longer routine performed to music.