For your first step select one existing image or create your design as you like.
First take a rectangle select tool and, make a rectangular selection around the edge of the image.
Then click on the the QuickMask control button.
The QuickMask control button is located at the lower-left side of the image.
After you click the red QuickMask button, a translucent red mask appears around your selection.
This red mask represents the outside of your selection. If you don't want then again click the
QuickMask button to go back into normal selection mode.
So, let's start playing with this mask. First, right click on the image and select Filters ->
Distorts -> Waves from the menu. Apply the filter, and watch what happens to the mask.
The mask gets ready. Let's add one more effect: Filters -> Blur -> Gaussian Blur.
Now that there is a soft edge on the mask, click the dashed QuickMask button to convert the mask
back into a selection.
Our last step is to use Select -> Invert image and Edit -> Fill with BG Color. The result,
a soft lightblue (color as you selected) fade into the background, is shown in the final step.