Older versions of the PSP firmware (eg. 1.50) have a vulnerability that allows easy execution of custom code on the device. Every since Sony has fixed the flaw in newer versions, the firmware downgrade to 1.50 became the "Holy Grail" of PSP homebrew development. After the discovery of a buffer overflow in version 2.0 of the PSP firmware, many rushed to be the first to release a working firmware downgrader.
Soon, one of these firmware dowgrade tools turned out to be a trojan that renders the PSP unusable. The infamous patcher from PSP Team removes a few important system files from the flash which makes the system unbootable. Our analysis confirmed these reports.
This tool has been reported to be the first "PSP virus" by many sources. Since it does not replicate in any way, by our definition we can call it a trojan at most. It definitely falls under the malware umbrella term, however.
It is worth mentioning here that, according to Sony, running any unauthorized code on the PSP will immediately void the warranty.