Sn0wbreeze for iOS 4 will allow users to create custom firmware (.ipsw file) so that they can update and jailbreak their iPhone with iOS 4.
Sn0wbreeze will support the same devices as PwnageTool 4.0:
iPhone 3G (might require DFU)
iPod Touch 2G (non MC model, not already jailbroken using Spirit jailbreak)
iPhone 3G users can enable the multitasking and custom homescreen wallpaper features using Sn0wbreeze, which are officially not available in iOS 4 for the device.
Please take a backup of your iPhone before you use PwnageTool to jailbreak it. Please refer to this post for more details. As with any hack, please proceed with caution as jailbreaking your iPhone could void it's warranty so proceed at your own risk.
You can download the latest version of Sn0wbreeze from this link.
As always, please let us know how it goes.