I'm going to say this now so I can copy and paste this into other threads to explain exactly what a cfw is:
Basically, a cfw (Custom FirmWare), is several patches applied to the 3ds OS launched via some sort of exploit (in most cases b9s). These patches range from signature patches (allowing for the installation of CIA files with invalid tickets) to the Rosalina system module that pops up when L+DOWN+SELECT are held. Otherwise, there is no difference between a regular vanilla 3ds and a 3ds with a cfw launcher installed (as a cfw is never really installed. What is really being installed is something that launches a cfw. That's why godmode9 and other payloads can be loaded too). This means that the 3ds can be updated as normal, with no need to worry about losing games or saves. Updating functions just like normal. The same goes for updating games, which is discussed in detail later. In fact, you could install b9s (boot9strap) and use your 3ds like a completely normal 3ds, and there would be absolutely zero difference between that 3ds and a regular vanilla one. The only way to tell would be to send it in to Nintendo.
Due to a lack of account system on the 3ds at launch (Nintendo network IDs were shoehorned in later, and thus don't function quite right), all 3ds games acquired illegitimately (CIA files) function identically to games that were purchased and installed through legitimate means. This means that pirated games can be updated and played online just like normal games. The only exception to this is if the game is from a different region then the 3ds itself. Those games muse be updated via a dumped update CIA file, which are easy to come by.
Lastly there comes the fear of being banned from Nintendo's online services, which for the most part have been blown out of proportion. As stated earlier, a cfw 3ds is no different then a regular 3ds aside from a few patches here and there. This makes it 100 percent impossible for Nintendo to detect a console running a cfw, and thus impossible to ban. Even running games invested via a cia file online are guaranteed to work fine online. Now this isn't to say that bans are impossible to come by. Many cfw users have been banned for unknown reasons. Though not much is known about these bans, there are several things that are known. 1: it is not caused by running a cfw or using pirated games. 2: users who do not use CIA Homebrew apps and instead use Rosalina 3dsx loading have been shown to be unbanned. 3: cheating online or playing leaked roms before they have been released will 100 percent result in a ban. From these clues, it can be concluded that people who simply use Rosalina to load 3dsx Homebrew instead of using custom Homebrew CIA files are nearly guaranteed to be safe from any future banwaves.
Again this might be a bit long to read, but I wanted to get this info out there, and so I would never have to bring this up ever again. People are free to quote this in their own posts if they feel this gets a good point across. I might update this post for updated information and/or spelling corrections. This was typed in the middle of the night on mobile so spelling mistakes are bound to be abundant.