Thank you so much for your lovely feedback Anangsha, it means a lot to know how much you enjoyed my story.
Fiction isn't huge on Medium but there's a small and supportive community of fiction writers on here who are great to work with. There's also a few publications that take fiction pieces.
You can use the drop cap feature to add the large cap at the beginning of the story. Highlight your first sentence so the black edit tab appears and go to the second to last function, a T with lines.
However, that will only give you plain text.
The fancy letter in Blade of Souls was provided by the excellent editor of Fantasy Shorts. I suspect he inserts it as an image but not entirely sure.