The PlayStation 3 hacking scene has been brought back to life when a team of hackers called fail0verflow announced that they discovered the PS3's main decryption key, meaning they can now sign any piece of software and the Sony console would recognize it as being legitimate software.

Many hackers and homebrew developers jumped at the opportunity, with GeoHot being the most proficient.

The hacker, famous for breaking open the PlayStation Portable many years ago, has just released a jailbreak version of the PlayStation 3's latest 3.55 firmware edition.

While a custom firmware version was already released last week, GeoHot's edition has a lot more features, and keeps the basic functionality of the PS3.

Owners of the console just need to download the new firmware, put it on a USB drive and do a firmware upgrade on their device.

This modified 3.55 version allows users to install package files, so many homebrew developers have already ported various emulators onto the device, including ones for the Nintendo Entertainment System or the Super Nintendo Entertainment System, as well Gameboy, Gameboy Color, Gameboy Advance, SEGA Master System or Game Gear.

Bear in mind that this modified firmware only allows homebrew apps to be installed, so pirated copies of actual games can't be played using GeoHot's software.

The hacker said on multiple occasions that his releases won't condone piracy, so the firmware version doesn't allow applications to access enough resources to run full-pledged titles.

Still, considering the vast hacking scene, which was already active with the release of the PSJailbreak last year, it's just a matter of time until someone manages to crack it and run pirates games on the PS3.
(quote shamelessly ripped from another forum)