From The Apple Wiki

NitroKey was a product released in late February 2009, by the company "NitroKey," in order to aid those with a tethered jailbroken iPod touch (2nd generation) to boot their iPods. It consisted of a small dongle that looked EXACTLY like the end of an iPod cable, with no cord on it. The product was being sold for an outrageous price of $55.00 to those unfortunate enough to have made the decision to purchase one, as it went obsolete within two weeks after its release.

They also released a stolen version of the 0x24000 Segment Overflow, the vulnerability that the untethered iPod touch (2nd generation) jailbreak uses, giving Apple enough time to fix the iPod touch (3rd generation) so that it CAN NOT be directly jailbroken from its release. In addition, NitroKey's irresponsible handling gave Apple enough time to add the ECID tag to the IMG3 File Format in the iPhone 3GS, preventing a permanent untethered jailbreak without a new iBoot exploit in every firmware.

NitroKey has also leaked AT+FNS, a baseband hole which was meant to be kept secret. [1][dead link] The hash was posted by NitroKey one day after Oranav found and shared the exploit with the iPhone Dev Team, making things very suspicious. Apple has now patched the hole, needlessly burning an exploit that could have been used as an unlock vector for a future firmware.