I'm not sure, I'm in the same boat and am firmly waiting on 4.0.1 for a softmod (no hardware changes needed, no opening the console). Currently any launch model can be hacked by putting a piece of metal between pins 9 and 10 of the right joycon, as this creates a short circuit that boots the system into recovery mode, which from this point it is possible to launch any code, meaning play backups and emulators and homebrew. Sounds scary but as long as you only short 9 and 10 no harm is done. You can buy devices online to help you with this. However, you need to do this every time you boot the system, or else you boot into the official firmware (as in, what Nintendo wants you to use). Check this vid out for more info, not as scary it sounds but still ghetto: https://www.youtube.com/watch?v=3-UeB_enPrM
My knowledge is a few months old (The scene grows quickly but is still very young) and last I checked there are 2 different custom firmwares, one's better but costs $30 from some company and the other is open source and free but not quite as compatible on the backup side. Personally I want a softmod so I'm just waiting and not updating, and play to buy the rumored small cheaper switch and the rumored switch pro, and those 2 I will keep stock. The launch model will become my portable emulator/backup powerhouse.>>462324303
Forgot to mention a hacked vita also plays every PSP game perfectly, including backups. My ps vita with sd2vita has every game that I like on these consoles (hundreds of games) on NES, GB/GBC/GBA, genesis, sega SD, 32X, sega master system, sega game gear, neo geo pocket, PSP, virtual boy, and of course the PS vita, all free.