Genshin Impact developer Hoyoverse has settled with the Federal Trade Commission (FTC), agreeing to a $20 million fine and a ban on selling loot boxes to children under 16. The FTC's press release states Hoyoverse will block in-app purchases for underage players without parental consent.
FTC Bureau of Consumer Protection Director Samuel Levine stated that Genshin Impact misled players, particularly children and teens, into spending significant sums on in-game prizes with low win probabilities. He emphasized that companies employing deceptive tactics, especially targeting young players, will face consequences.
The FTC alleges Hoyoverse violated the Children's Online Privacy Protection Rule (COPPA) by marketing to children and collecting their personal information without proper consent. Further accusations include deceptive practices regarding the odds of winning "five-star" loot box prizes and the actual cost of obtaining them. The FTC claims the game's virtual currency system was confusing and unfair, masking the substantial cost of acquiring desirable prizes, leading to significant spending by children.
As part of the settlement, besides the fine and the ban on loot box sales to minors, Hoyoverse must disclose loot box odds and virtual currency exchange rates, delete personal information collected from children under 13, and ensure future compliance with COPPA regulations.
