We Investigated Loyal-bit: Legit or Scam? The Facts

Recently, Loyal-bit.com service popped up, promoting itself as a place where you can safely keep cryptocurrency and other assets. I managed to gather credible evidence that unmistakably reveals it is, actually, a scam site.

Regardless of the promises of the most easy, reliable, and client-friendly service, Loyal-bit.com does not fulfill any of them. In fact, all this is just a gilded wrap around a dirty scam, which steals your money and data and never returns them. Any stories about bonuses, endorsement from celebrities etc are non-existent as well.

Loyal-bit Scam Overview

Originally, Loyal-bit poses as a cryptocurrency trading & cryptowallet platform with remarkably low commission fees. Another highlighted selling point for this site is backing from celebrities that are known in the crypto world. Elon Musk, Bill Gates, Vitalii Buterin, Warren Buffet – the site says about being supported by them. To make these claims look real, rascals employ deepfake videos where those celebrities advertise the scam as the best thing in the world. For obvious reasons, Elon Musk is the most common among them. But, as I mentioned above, all this is just a vivid wrap around an obvious scam.

Loyal-bit Scam

Initially, Loyal-bit shares the design of multiple similar online platforms. There are quite a few examples, like Chainspacex, Ether or Siacoinex. They are completely indistinguishable in terms of visual elements, with minor discrepancies in the site header. Other details, and at times even crypto wallet addresses, are the same. Probably, all these deceptive websites are managed by a single group of swindrels.

Cryptocurrency Scam Summary

How the Loyal-bit Scam Works?

Loyal-bit is a part of a extensive cryptocurrency scam scheme that started circulating actively in 2023. Swindlers who stand behind it use several website designs, which still share the same overall layout. Another common element are the ways the scams like NAME are promoted, and the manner all this ends up to the victim of the scam. To reach peak efficiency, frauds apply sophisticated psychological tricks that make the user believe in the validity of the website. But let’s review them one by one.

Step 1: Promotion

To start the fraud, criminals establish and fill accounts on popular social media platforms. They primarily focus on Facebook, Instagram, Twitter, and TikTok. Subsequently, the advertising campaign starts. Utilizing bots and paid ads (when achievable), scam actors intensify the exposure of their scam activities to potential victims. And as I said, fraudsters do not disdain using generative AI for creating videos with the mentioned celebrities that advertise their scam to the public. To boost the folks even more, swindlers claim the bonus for every user who registers the service immediately.

Promotions of cryptoscams like Loyal-bit in TikTok. Most of these videos are AI-generated deepfakes

Users receive a stimulus to sign up, enticed by the assurance of receiving cryptocurrency benefits valued at hundreds of dollars, all without cost. To enhance the attractiveness of the offer, fake claims of cooperation with a celebrity are incorporated. As you may guess, these claims are completely baseless.

Step 2: Gaining Traffic

After clicking the promos, victims end up on a page filled with appealing offers. “Crypto starts with Loyal-bit”, “Your crypto savings are secured with Loyal-bit, “Start earning with Loyal-bit – they look rather credible. To heat up users and make them proceed to step 3, crooks say that claiming the promoted bonus requires registration. And as nothing concerning happens at this point, unexperienced users happily keep on – especially since the gift appears to be right behind the corner.

This is the last stage when it is possible to get away from the scam without any losses. Before you register using your personal information, frauds will not be able to earn even a nickel from your presence on the website.

Step 3: Data Gathering

This is where the main fraud action begins. As I just said, frauds bait folks into registration for bonuses. And all the personal information needed for it – username, email, crypto wallet address – is valuable for user identification. Exclusively by gathering this information and selling it further into the Darknet, crooks can earn quite a penny. Still, their plans go much further.

As it turns out, you cannot use the promised bonus right away. To make it at least usable for crypto purchases, you need to top up the account with the equivalent sum. At this point, the final stage of the scam begins.

Step 4: Requesting funds

Obviously, any cryptocurrency operations require you to have money on your account. In the case of Loyal-bit, users are also coerced to top up to claim the bonuses. And this is what creates the majority of the money flow to this scam site. By topping up the account, users hope to get the pledged gift (usually $500-1000 in USDT), and may start engaging on this site hoping to use all the deposited money and withdraw them.

This, however, is where the issues start to surface. When keeping an eye on the real cryptocurrency wallet vs what the site says, you can notice that no transactions are done whatsoever. And then, when you’d try to retrieve the money from your account, the scam is finally uncovered to the user.

Step 5: Escaping from Funds Withdrawal

There’s no need to explain that fraudsters are naught on intentions to send you money. Though to make it look more realistic, they’ve made up a whole bunch of reasons to decline the transfer-out request. Usually, they repeat what KYC regulations say, but for the Loyal-bit.com they are here only to make the wireout impossible.

By requesting your personal info, scammers just stall hoping for you to accept the loss and stop contacting them. If you don’t – well, there are multiple other checks you should go through before getting your funds back. And every check will uncover more and more information, which – you guessed it right – will be then traded on the Darknet. Never reveal your real info to strangers!

Signs of Scam

I gathered several facts that point at the scammy nature of the Loyal-bit.com. Actually, there are a lot of scams that fall under the same points, so they are pretty much universal.

• Absent company details. Loyal-bit does not provide any documentation about its ownership, location or registration. No legitimate contact details are given either. Moreover, it appears that the domain and all social network pages were registered quite recently.
• Fake sponsorship from a celebrity. Scams like Loyal-bit like to pick a celebrity as a sponsor of this entire campaign. For obvious reasons, fraudsters generally choose Elon Musk, Jeff Bezos, Mr. Beast, Mark Zuckerberg, and similar celebrities. They do not disdain claiming partnership with a company as well. Even though Coinbase, Binance or MetaMask never heard of Loyal-bit, they do not care – this creates a halo of credibility.
• Potential Ponzi Scheme. The scam relies on a Ponzi-like referral system to spread reach through social media. In fact, only the first members will receive the payoff, at the cost of the money brought by other members.
• Hype without facts. Frauds can cheer up their victims from time to time, using claims about non-existent events. “We got contracts with Coinbase”, “Elon Musk mentioned us as the most prolific crypto project” – you could likely hear something like that. This is made to make people believe in their money return. This can be the sauce to make people top-up their accounts once again.
• Crypto-only incoming payments. Whether the user tries to top-up the account, hackers will only accept payments in crypto – no bank transfers or other payment methods. Such an approach completely hides the identity of the company and deprives you of the ability to ask for a refund.
• Claims are too good to be true. Let’s be sane and sober: even in crypto space, there are not many places where you can earn 50-100-200%. Being able to participate in all of them is nearly impossible, as well as it is impossible to insure or hedge all the risks. Even by that reason alone I can tell that the Loyal-bit is a definite scam.

What Should I do as a Victim?

If you had to deal with Loyal-bit site and fell victim to that scam, there are still some steps to take. They will make further scam attempts harder, and also boost the knowledge about that scam among folks.

• Immediate Reporting. Your initial step should involve promptly notifying local authorities specializing in financial fraud. Extend your reach by reaching out to wallet providers and engaging with social networks’ technical support teams. These actions serve to raise the bar for the scammers’ operations.
• Share among Friends. Amplify your efforts by informing your close friends about the scam. Similar to informing authorities, this dissemination of information restricts the scammers’ potential victim pool.
• Preserve Crucial Information. Compile a comprehensive evidence archive by capturing screenshots and archiving all relevant website-related data. Collect the website URL, screenshots of the main page, login interface, end-user license agreement (EULA), account top-up menu, and wallet addresses. These records could provide vital clues for authorities in their pursuit of the scammers.
• Exploring Refund Options. While most banks’ refund policies may exclude cryptocurrency payments, it’s advisable to explore potential refund avenues under specific circumstances. Maintain hope until you obtain confirmation of the loss.
• Transform Loss into Knowledge. Turn your financial setback into an opportunity for growth. View your loss as an investment in understanding the strategies employed by crypto scam sites. Familiarize yourself with their telltale characteristics, the methods they employ to entice individuals, and the extravagant promises they make. Equipped with this insight, you’ll be well-prepared to spot and evade future traps without suffering additional financial setbacks.

Scan your system for possible malware infections

Beware of cross scams! Scam actors can use your trust to make you download some stuff or interact with certain documents. It may be a trap that installs malware to your system. There are no moral barriers or limits for these scoundrels.

Throughout the course of the fraud, its actors may contact you with particular files. Alternatively, they may suggest you to install “cryptocurrency wallet applications” or “browser extensions” to simplify access to your crypto savings. As we already figured out, these rascals have no intention of restoring your capital. So, what can these messages and browser extensions represent? Correct – that is another element of the fraudulent scheme designed to throw you into willingly installing destructive software onto your device.

Both add-ons and files attached to email messages can act as a carrier for diverse malware. In this case, I foresee the presence of spyware and stealers among all types of threats. While it is not mandatory for scammers to distribute malware, the likelihood is always greater than zero. As previously mentioned, their ethics is of negligible importance, and their reputation is already seriously marred. They have no scruples to lose and strive to maximize gains.

Frequently asked questions