In Chapters 942 Hiyori stated that the people of Ebisu Town can only smile because of the SMILE fruits.
In chapter 943 she tells Zoro that Orochi and the SMILEs are responsible for stripping them of their sadness, and Zoro is confused about the role of the SMILEs in this.
In the meantime, Kanjuro, Shinobu, Sanji, Nami, Usopp, and Franky reach the Flower Capital, and the Straw Hats are confused by the Ebisu citizens’ reactions.
In the Prisoner Mines, Queen enjoys the scene, and Luffy wonders about the reason for the citizens laughing; Hyogoro replies that it is a side effect of the SMILE that he has seen in the prison as well. On Onigashima, Kaido chuckles at Orochi’s brutality.
Shinobu then explains the side effects of the SMILEs to her group. Several years ago, Kaido and Orochi started trading weapons to Caesar Clown and Donquixote Doflamingo in exchange for SMILEs, which Kaido used to try to make his crew the strongest in the world.
However, only one out of every ten people who ate a SMILE received an ability from it. Everyone else simply received the side effects of the fruit, losing the ability to swim as well as the ability to express negative emotions, causing them to only be able to express joy.
Among the Beasts Pirates, the Waiters are those who have yet to consume SMILEs, the Gifters are those who have eaten the fruits and successfully gained powers, and the Pleasures are the larger group who have eaten a SMILE and received nothing except its side effects.
Kaido, Doflamingo, and Caesar named the fruit SMILE after its most notable side effect. The defective fruits still contained these side effects after being partially eaten, and so Orochi decided to use them to deal with the people of the leftovers towns, who were wracked with sorrow and grief on a daily basis due to the constant deaths among them.
Finding this to be unpleasant, he mixed in the defective SMILEs with the other leftovers that were fed to the leftovers towns, causing these citizens to lose their ability to express sadness and anger.