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I bought a basic wheel set for a hack bike project. The rear wheel has a single speed cog, and a dangly adjuster thingy - maybe 2 inches long. What is that for?

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Could you perhaps include a picture or a link to something similar? –  jilles de wit Dec 3 '12 at 10:58
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This really needs a picture or a more detailed description. There are several things that could conceivably be dangling back there... –  freiheit Dec 3 '12 at 17:57
    
Hi Guys, ill add a photo tonight when i get home from work. Thanks for pitching in. It is definitely not a internal hub or coaster brake. –  Will Dec 3 '12 at 22:02
    
Given that it is a single speed, it could be a chain tensioner. But as the other commenters have said, a picture would help. –  deemar Dec 6 '12 at 11:03
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2 Answers

The dangly adjuster thing is most likely the toggle chain for an internally geared hub!

3 speed hub

The tension on that chain shifts the hub internally (rather than through a derailleur and cogset). Bike hacks with three-speed hubs are quite common, but get very complicated. Here is some information on Sturmey Archer hubs courtesy of Sheldon Brown.

Below is a picture of the toggle chain and rod which is attached to the inside of the hub. Good luck!

enter image description here

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Also, an alternative to @Tom77's suggestion of a coaster brake, it could also be a drum brake which will have a reaction arm and an actuation arm. They can be installed on front or rear hubs and are frequently cable actuated (as opposed to a coaster brake's pedal-actuation.) –  WTHarper Dec 3 '12 at 19:13
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It sounds like you have a coaster brake (operated by pedalling backwards), if this is the case then the dangly thing is the reaction arm.

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