Enchanting
Magic items inherit their character from those who wield them. To imbibe an item with magic you must accomplish something substantial with it, most often outside of its intended use or tolerance. After the task is finished, in the light of the moon you may whisper what enchantment you want the item to have. These boons must be relevant to the task though. An item may receive as many boons as incredible feats are accomplished with it. But each feat must outdo the last or item will not accept the magic.
Cursed items are from those who die trying to accomplish something incredible. Greed drives looters to pick up these relics of the dead and make their own magic item. They are appropriately punished.
Dragonfire licks and warps a knight's shield. He survives the encounter and enchants the shield with an immunity to flames.
An archer shoots blindly into the darkness of a dungeon against overwhelming numbers. The arrows slay the orcs and halt their attack. Later the archer enchants the weapon to cast light. In another ruin the archer uses the bow's light to distract a powerful demon so his friends may escape. The demon's claws tear the bow but the archer makes it out again. This time they enchant it to bind demons to servitude if it strikes the killing blow.
A pit of snakes bites a man dead as he tries to run across them. His sandals are looted and enchanted by an odious merchant to grant speed like a serpent. The cursed sandals summon 3d20 cobras that only attack the wearer. If the snakes are killed the sandals do grant the boon until they are taken off again.
Alternative Method
Spend 100,000 gp per enchantment you want the item to have. If it becomes known the item was enchanted using wealth it becomes powerless and shatters.