Three users lost $1.8M in Bitcoin through a fake Sparrow Wallet on the iOS App Store. Apple faces a California lawsuit over false advertising claims.
Three crypto users lost a combined $1.8 million in Bitcoin through a counterfeit Sparrow Wallet downloaded from Apple's iOS App Store, according to a lawsuit filed in California.
The app ran on the store between May and August 2025. Sparrow Wallet is a desktop-only application for Windows, macOS, and Linux. Users who downloaded the fake version typed in their seed phrases, which attackers then used to drain their accounts.
The three plaintiffs lost $875,000, $840,000, and $120,000 in Bitcoin, respectively. They argue that Apple markets the App Store as a "safe and trusted" marketplace but failed to catch the fraudulent listing.
The App Store placed the fake app into its curated cryptocurrency collections, which added to its credibility. It also did not block a Sparrow Wallet listing that came from a developer other than the official one.
Craig Raw, the official developer of Sparrow Wallet, testified that he spent years flagging copycats on the store. When he tried to upload a text-only app warning iOS users that no mobile version existed, Apple threatened to suspend his developer account.
Apple faces charges of false advertising and consumer law violations. The plaintiffs seek Bitcoin reimbursement and punitive damages, plus a court order requiring Apple to issue explicit fake-app warnings on the store.
Apple declined to comment on the active litigation. Representatives said the fraudulent app had been removed and its associated developer accounts terminated. They pointed to the firm's 2025 anti-fraud numbers: blocking over $2.2 billion in fake app transactions and shutting down 193,000 malicious developer accounts.
Three months earlier, a fake version of Ledger Live on the Mac App Store drained $9.5 million from users.
Drafted by a large language model from the source reporting linked above, then screened by automated publishing checks. It is not read by a journalist before publication. Some articles cite our Alpha Score. Verify prices and figures against the original source. Educational coverage, not personalized advice.