For the Dwarves:
* Obsession: The dwarves were driven by a deep-seated desire to reclaim their ancestral treasure, the Arkenstone, and the vast wealth Smaug had accumulated in the Lonely Mountain. This obsession, though understandable given the loss of their homeland and heritage, became all-consuming and led them to make reckless decisions, ultimately sparking a war.
* Greed: Though initially focused on reclaiming their own, the dwarves, particularly Thorin Oakenshield, became consumed by greed for the dragon's hoard. This desire for more blinded them to the potential consequences and led them to mistrust their allies, even those who had helped them reclaim their homeland.
* Conflict: The dwarves' focus on treasure, particularly the Arkenstone, became a source of conflict, not only with Smaug but also amongst themselves and their allies. The argument over the Arkenstone between Thorin and Bard, the leader of Lake-town, nearly led to a disastrous war.
For Smaug:
* Power: The dragon Smaug was fueled by the vast treasure he had amassed. The gold and jewels were not just a source of wealth but also a source of immense power, feeding his ego and making him feel invincible.
* Isolation: While the treasure gave him power, it also isolated him. Smaug, who was already a solitary creature, became obsessed with his hoard, becoming wary of even his own kind. This paranoia led to his downfall.
* Destruction: Ultimately, Smaug's obsession with his hoard led to his destruction. He became so focused on his gold that he was blind to the threat posed by the dwarves and their allies.
In conclusion, the treasure, while initially a source of joy and hope for the dwarves, ultimately led to their downfall. For Smaug, it fueled his power but also became his weakness. Ultimately, both the dwarves and the dragon were ultimately corrupted by their lust for wealth.