Three Bitcoin(BTC) holders sued Apple in California federal court, saying a counterfeit Sparrow Wallet app on the App Store drained $1.8 million. Key Points: Three plaintiffs say a fake Sparr
Three Bitcoin(BTC) holders sued Apple in California federal court, saying a counterfeit Sparrow Wallet app on the App Store drained $1.8 million.
- Three plaintiffs say a fake Sparrow Wallet listing on the App Store cost them a combined $1.8 million in Bitcoin between May and August 2025.
- Apple denies negligence, saying impersonation apps violate its rules and that it has shut down the developer accounts behind them.
- The wallet's real developer has been flagging copycat listings to Apple since early 2024.
The complaint reached the U.S. District Court for the Northern District of California on Jul. 24. James Ramirez lost roughly $875,000 in Bitcoin, Christopher Ellis about $840,000 and Jalen Delgado close to $120,000, with the thefts running from May through August 2025, the filing states.
The genuine wallet is desktop software for Windows, macOS and Linux, so any iOS listing carrying that name was a fake. The app asked users to type in their seed phrases, and the scammers then drained the accounts and moved the coins into their own wallets. Ellis reported the theft to Apple the same day, according to the complaint.
The three accuse the company of breaking California's consumer protection law, arguing that Apple sold the App Store as a safe and trusted place to download software while spoofed wallet apps slipped through its review.
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Apple declined to comment on the active litigation, though it defended its screening record. The company told reporters that impersonation apps breach its guidelines, that it removes them quickly and that it has already terminated the developer accounts behind the fake Sparrow listings.
It pointed to figures showing more than 371,000 submissions rejected last year for spam, copying other apps or misleading users.
Apple also said no Sparrow copycats sit on the store today, a claim the complaint disputes. The plaintiffs want a jury trial, reimbursement of the stolen coins and explicit warnings about the risks of downloading crypto apps.
Their case lands in a punishing year for fraud victims, and it takes aim at the walled garden argument Apple has long used to resist sideloading and rival app stores.
The FBIlogged $20.9 billion in reported cybercrime losses for 2025, a 26% rise, and cryptocurrency turned up in 181,565 complaints worth more than $11.4 billion, over half the annual total.
Craig Raw, the South African developer who built Sparrow and holds the U.S. trademarks on its name, has warned about copycats for more than two years. In January 2024 he posted that a scam Sparrow app was still live weeks after he and others flagged it.
He later offered a placeholder app telling iOS users the wallet is desktop only, but Apple rejected it and in June flagged his developer account for termination over "dishonest activity," a decision the App Review Board reversed after an appeal.
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