Apple is facing a lawsuit claiming it allowed a fraudulent bitcoin wallet app to remain on its App Store, despite being informed of a theft of $875,000, which subsequently led to another user losing about $840,000. This lawsuit highlights serious concerns regarding app security on the platform.
A lawsuit alleges Apple kept a fake bitcoin wallet app on its store after one user reported an $875,000 theft, leading to another user having roughly $840,000 stolen.
Filed on July 24 in the U.S. District Court for the Northern District of California, the lawsuit reveals that three plaintiffs have collectively lost approximately $1.84 million after downloading an app that misrepresented itself as Sparrow Wallet. They entered their bitcoin seed phrases into this app, which enabled the theft of their funds.
The plaintiffs contend that Apple's marketing practices led them to believe that all applications in its curated marketplace were thoroughly vetted and secure. Their claims include violations of consumer protection laws, as well as allegations of fraudulent and negligent misrepresentation, and failure to provide adequate warnings.
This is not the first time Apple has faced such allegations. In 2021, the company was sued by cryptocurrency holders over a similar scam involving a fake wallet app, but that case was dismissed when a federal judge ruled that Apple could not be held liable as it was deemed a publisher rather than a creator of the app's content.
In this recent case, James Ramirez reported that he downloaded the fraudulent app on July 25, 2025, and had 7.4 BTC stolen. He reported the incident to Apple on the same day. Another plaintiff, Christopher Ellis, claims to have lost about $840,000 after installing the app on August 3. Jalen Delgado, who downloaded the app around May 1, 2025, lost 1.05 BTC, which at the time was valued at roughly $120,000, based on his trust in Apple's assurances regarding the safety of its App Store.
According to the lawsuit, Apple did not respond to the theft reports made by Ramirez and Ellis.
The legitimate Sparrow Wallet is actually a desktop application available for Windows, macOS, and Linux, and does not have an iOS version.
The lawsuit claims that Apple not only allowed the fraudulent app to be listed but also promoted it alongside legitimate apps in curated collections. Additionally, it references a warning from Sparrow Wallet’s developer, Craig Raw, who alerted Apple in January 2024 about the impersonation, yet the app remained available for weeks afterward.
The plaintiffs are seeking reimbursement for their stolen assets, along with compensatory and punitive damages. They also demand that Apple disclose the limitations of its app review process, enhance its security measures, and inform users that App Store listings do not guarantee the authenticity of cryptocurrency applications.
Apple’s response
In response to the allegations, Apple informed MacRumors that it has taken steps to remove any apps impersonating Sparrow Wallet from its App Store and has terminated the developer accounts associated with those apps.
The company stated that developers who believe their intellectual property rights have been infringed can file a dispute with Apple’s legal department, and customers are encouraged to report any scams or fraud encountered in the App Store.
Apple noted that it has previously terminated 193,000 developer accounts due to fraud and, in its App Store fraud report, it highlighted that it rejected over 371,000 misleading submissions last year, preventing more than $2.2 billion in potentially fraudulent transactions.
CoinDesk reached out to Apple for further comments but had not received a response by the time of publication.