Genshin Impact developer Hoyoverse has agreed to a $20 million settlement with the Federal Trade Commission (FTC). The settlement includes a ban on selling loot boxes to players under 16 without parental consent.
In an FTC press release, the agency stated that Hoyoverse will pay the $20 million fine and implement measures to prevent underage in-game purchases without parental permission. Samuel Levine, Director of the FTC’s Bureau of Consumer Protection, criticized Hoyoverse for deceptive practices, stating that the company misled children, teens, and other players into spending significant sums on in-game prizes with low odds of winning. He emphasized that companies employing such tactics will face consequences.
The FTC’s complaint alleges Hoyoverse violated the Children’s Online Privacy Protection Rule (COPPA) by marketing Genshin Impact to children and collecting their personal information without proper consent. Further allegations include deceiving players about the odds of winning “five-star” loot box prizes and the actual cost involved. The FTC contends that the game's virtual currency system was confusing and unfair, obscuring the high cost of obtaining desirable prizes and leading to significant spending by children.
As part of the settlement, in addition to the fine and the ban on loot box sales to minors without parental consent, 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.
