Investors allege Apple failed to vet a fraudulent app that stole Bitcoin by harvesting recovery phrases from users.
Three cryptocurrency investors filed a federal lawsuit against Apple, claiming they lost a combined $1.8 million in Bitcoin through a fake wallet app on the App Store. The plaintiffs allege the app impersonated Sparrow Wallet and tricked users into entering recovery phrases, which scammers used to transfer funds to their own wallets.
The lawsuit, filed in the U.S. District Court for the Northern District of California, accuses Apple of violating consumer protection laws by inadequately monitoring apps. Losses for the plaintiffs—James Ramirez, Christopher Ellis, and Jalen Delgado—totaled $875,000, $840,000, and $120,000, respectively, between May and August 2025.
Apple’s market capitalization recently reached $4.989 trillion, surpassing Nvidia as the world’s largest public company. The plaintiffs argue they trusted the App Store’s safety claims, which the lawsuit says were not upheld in this case.