Bitcoin Users Lose $1,800,000 After Installing Fake Sparrow Wallet Apps on Apple App Store
Bitcoin (BTC) users have lost a combined $1.8 million after downloading fraudulent mobile apps that impersonated Sparrow Wallet, a desktop-only wallet. In a lawsuit filed in the United States District Court for the Northern District of California, victims accuse Apple of failing to adequately review and remove applications masquerading as the Sparrow Wallet mobile app, while promoting the App Store as a safe source for software.
The victims claim they entered their recovery phrases into fake Sparrow Wallet apps, allowing thieves to drain their holdings. Sparrow founder Craig Raw had been warning about unauthorized versions as early as 2024, noting that a mobile version could have been easily flagged as fraudulent since Sparrow is a desktop-only wallet.
Plaintiff James Ramirez states thieves drained approximately $875,000 in BTC after using the fake wallet and notified Sparrow and Apple the same day. Christopher Ellis alleges a similar app stole $840,000 in crypto. Jalen Delgado claims he lost about $120,000 after downloading a fake Sparrow Wallet in May 2025.
Security researchers earlier identified 26 comparable fraudulent wallets mimicking brands like MetaMask and Ledger, many capable of capturing seed phrases through phishing. The real Sparrow Wallet operates only on Windows, macOS, and Linux with no official mobile release.
Apple says it has removed the fake Sparrow apps and closed associated developer accounts while emphasizing its existing fraud detection measures. The plaintiffs argue that marketing claims about App Store safety encouraged trust in the impostors and seek damages, reimbursement, restitution, and legal fees.