The FireCore developer team has created a program much like the iPad PwnageTool for your Apple TV. This tool is dubbed the name Seas0nPass and will work on your 2nd generation Apple TV, it creates custom firmware file to load and install non-Apple approved apps. This jailbreak requires tethering for boot of your Apple TV, much like your other iOS 4.2.1 Apple TV jailbreaks. Hopefully the tethering will go away once iOS 4.3 is launched.
According to FireCore LLC, a new version of seas0npass is being based on an untethered jailbreak for the AppleTV 4.1.1 (iOS 4.2.1) software. All credit for the untethered jailbreak process goes to the Chronic Dev Team.
seas0npass is available for free download
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