Prepare the smoker or grill by preheating it to 225°F (107°C). If using a charcoal grill, set it up for indirect heat with wood chips added for smoking.
In a mixing bowl, combine olive oil, smoked paprika, garlic powder, onion powder, salt, black pepper, and cayenne pepper (if using). Mix well to create a marinade.
Pat the chicken thighs dry with paper towels. Coat them evenly with the marinade, ensuring each piece is well covered. Let them sit at room temperature for about 15 minutes to absorb the flavors.
Add the wood chips to your smoker or grill. Once they begin to smoke, place the chicken thighs skin-side up on the grill grates. Close the lid.
Cook the chicken thighs for about 1.5 to 2 hours, or until the internal temperature reaches 165°F (74°C). Use a meat thermometer to check the temperature.
If desired, during the last 15 minutes of cooking, you can brush additional marinade on the chicken to enhance flavor and moisture.
Once done, remove the chicken thighs from the smoker and let them rest for 10 minutes before serving. This allows the juices to redistribute within the meat.