In the early days of Switch hacking, there were mostly people just poking and prodding at different parts of the console to see if it would spit out interesting stuff. Fairly rudimentary stuff, like checking for secret Amiibo with custom NFC tags, hacking together Joycon drivers and even opening the device to play with the exposed hardware: all of it perfectly legal. Eventually though, someone found the secret switch on the bookshelf (shorting out one of the physical controller connector pins if you're curious), and the community was off to the races to design a custom bootloader/firmware like they did on the 3DS and Wii.
This is where the problems start, as I'm sure most people here would know. Messing with software is a dangerous thing (legally speaking), and so effectively 2 camps were formed:
- Team Xecuter, a close-knit circle of devs who intended to hack the Switch come Hell or hard-modding. They had no stipulations against using leaked code, directly profiting off their customerbase or inflaming their community, when it came down to it.
- Team Atmosphère, an open-source project that went with the "slow and steady" approach, attempting to find an ethical softmodding solution that could easily be applied to any Switch without fear of legal repercussion.
Both of these teams would fight each other viciously over the course of 2 or 3 years. Team Xecuter was first to figure out game piracy, but Atmosphere had a working warmboot before Xecuter did. Atmosphere was able to install games locally before Xecuter could, but Xecuter figured out booting from attached storage before Atmosphere did. The groups traded blows like this continually until, like Napoleon looking out on the Mediterranean, there were no more features to conquer. Xecuter had an easy-to-install commercial hardmod that was almost exclusively designed for piracy, while Atmosphere had polished off a more difficult but rewarding softmod, with emulation and homebrew capabilities (and eventually piracy, too).
So, what was Team Xecuter's crime? Putting the signing keys in the hardmods they sent out. With every successive Switch firmware update, Nintendo would issue a new list of attestation keys that came with each game purchase. To allow unsigned games to be booted, TX packed in these keys (and offered them on a monthly basis afterwards to hardmod owners), which really sent Nintendo off, leading to arrests like the one mentioned here. Atmosphere remains thankfully untouched today, and even though the odds looked stacked against them, they have delivered the most polished Nintendo Switch modding experience you could ask for. It's quite wonderful stuff, especially if you've ever wondered "how would this Python script run on Switch...?"
...oh, and the Switch modding community was absolutely insane for those few competitive years. There were a few other noteworthy community villains like Blawar, but that's a story for a different time.