Apple was sued for App Store crypto wallet fraud, and users lost more than $1.8 million

Comparing news, Apple was sued by the US District Court of Northern California for allegedly failing to effectively prevent cryptocurrency fraud apps in the App Store. Three users accused Apple of omissions in its security review mechanism, which caused them to download fake crypto wallet apps and accumulated losses of over $1.8 million.

According to the lawsuit, the app involved impersonated Sparrow Wallet, but the official Sparrow Bitcoin wallet did not actually land on the iOS platform. Three users experienced asset losses after transferring Bitcoin to the fake app. One user lost around $875,000, another lost around $840,000, and the third lost around $120,000.

The plaintiff believes that Apple has long used the App Store's strict review mechanism as a security advantage, claiming that its closed ecosystem can reduce the risk of malware and fraud, so it is responsible for fraudulent apps on the platform. The lawsuit also cites public criticism from the founder of Sparrow Bitcoin Wallet, saying that Apple had previously allowed counterfeit apps to appear on the App Store.

The three plaintiffs requested a jury trial and sought recovery of losses and additional compensation, while also demanding that Apple increase App Store risk alerts and security disclosures.

Apple responded that impersonating another app is a violation of App Store rules. The company will quickly remove the relevant apps, and stated that there are currently no counterfeit Sparrow Wallet apps in the App Store. According to data previously released by Apple, in 2025, its review team rejected more than 371,000 app submissions involving counterfeiting, spam, or misleading users.