During winter seasons, most of us rub our hands together. Actually what happens there is that the kinetic energy of our hands is being transformed into heat energy .
( Why ?)
For this to understand, first of all understand friction force. In a nutshell , I would like to tell you that it arises from the bonding of the atoms of the surfaces in contact and due to separate these bonded atoms , you must supply them energy . This energy makes them vibrate when they separate and they start wiggling here and there and this is what you feel as hot.
But you can think of friction for simplicity this way too :
Because the friction force is opposing the motion of the surfaces in contact and this force does a negative work on the body i.e. in place of giving energy to the body, the body is releasing it's own energy and this energy is your kinetic energy which is ultimately being transformed into heat.
Same is happening with your paper ball thrown against the blowing ventilator , the energy is being continuosly released into the environment as heat (For the same reason).
If their motion was supported in place of being opposed i.e. force was not in the opposite direction of motion then the kinetic energy would have increased but not transformed.
When talking about atoms , suppose two atoms approach each other and get bonded . What actually happened there is that their kinetic energy get transformed in the form of photons (this is the reason why you see flash of light during some chemical reactions) or other forms . These released energy is then absorbed by the surrounding atoms and the same process goes on. If their is nothing left for absorbing that photon , then it will be just floating somewhere in the space :)
Hope it helps ☺️.