$1.8M Lawsuit Targets Apple Over Fake Crypto Wallet App

Apple is facing a $1.8 million lawsuit after three customers claimed to have lost their cryptocurrency funds through a fake Sparrow Wallet app on the iOS App Store. The application, which ran from May to August 2025, was designed to look like the legitimate Sparrow Wallet software for Windows, macOS, and Linux.

The fake app prompted users to enter their seed phrases, allowing attackers to drain their accounts. The three plaintiffs lost a combined total of $1.8 million in Bitcoin: $875,000, $840,000, and $120,000 respectively.

Apple is accused of false advertising and consumer law violations for marketing the App Store as a 'safe and trusted' marketplace, when it allowed the fake app to masquerade as legitimate software. The plaintiffs are seeking reimbursement in Bitcoin and punitive damages, as well as a court order requiring Apple to issue explicit warnings about fake apps.

Apple has removed the fraudulent app and terminated its associated developer accounts, but declined to comment on the active litigation. Craig Raw, the official developer of Sparrow Wallet, testified that he had spent years flagging copycats on the Store, only to have his own account threatened with suspension when he attempted to upload a text-only app warning users about no mobile version.