If you are a non-magic using class, this appears to be a fine dagger with a blade of obsidian.  It's sliver handle has a small garnet in the pommel with what appears to be an arcane rune engraved in the stone.  If you are a magic user, when you pick up this blade it seems to pull at your energies.  It feels warm in your hand and the garnet in the pommel has small sparks of light floating within it.  You get the sense that this blade is meant for use with spellcasting.

When you attack with this dagger a black flame tinged with bright red-violet engulfs the blade, it does 1d4 piercing damage plus 3d6 psychic damage.  If thrown the blade returns to your hand after travelling up to its maximum range or if dropped or disarmed the blade returns to your hand within one turn. You also have a +2 bonus to weapon attacks and a +2 bonus to spell attacks made while wielding this dagger.

Zed'tereth is a sentient weapon that only reveals itself as such once it has chosen a wielder. It revels in chaos and seeks to manipulate its wielder to entertain itself.  If the wielder has less than a 17 charisma score, they must make a charisma saving throw at the DM's discretion when Zed'tereth is attempting to influence their decisions.  Additionally, Zed'tereth talks incessantly at all hours of the day, possibly trying to drive its wielder mad and make them more malleable to its designs.  If the wielder has less than a 17 intelligence score they must make a DC 17 intelligence save to shut out Zed'tereth's voice every morning when they wake, every night when they go to sleep, and every time they enter combat.  Failing the save adds one level of exhaustion up to level 3 exhaustion.  After reaching the 3rd level of exhaustion, the wielder must roll on the short term madness table up to three times (six total fails in a row).  If you reach seven or more fails consecutively, you must roll on the long term madness table each time you fail for the next 1d12 months of game time.

Proficiency with a Dagger allows you to add your proficiency bonus to the attack roll for any attack you make with it.

Notes: Damage: Psychic, Bonus: Melee Weapon Attacks, Bonus: Spell Attacks, requires attunement by a chaotic spellcaster., Buff, Combat, Bane, Finesse, Light, Thrown, Nick