Genshin Impact Developer Agrees to $20M Fine Over Loot Box Violations

Genshin Impact's publisher, Hoyoverse, has reached a significant settlement with the United States Federal Trade Commission (FTC), agreeing to a $20 million fine and a ban on selling loot boxes to individuals under the age of 16. In a press release, the FTC detailed that Hoyoverse will also prevent children under 16 from making in-game purchases without parental consent as part of this agreement.

Samuel Levine, the Director of the FTC's Bureau of Consumer Protection, criticized Hoyoverse for misleading children, teens, and other players into spending substantial amounts of money on prizes with low winning odds. Levine emphasized that companies employing such "dark-pattern tactics" would face consequences, particularly when targeting young audiences.

The FTC's main allegations against Hoyoverse include violations of the Children's Online Privacy Protection Rule (COPPA). The agency claims that Hoyoverse marketed Genshin Impact to children, collected their personal information, and deceived players about the odds and costs associated with winning "five-star" loot box prizes. The FTC further argued that the game's virtual currency system was designed to be confusing and unfair, obscuring the high costs players, especially children, would incur to obtain these coveted prizes.

In addition to the fine and the ban on loot box sales to minors, Hoyoverse is required to disclose the odds of winning from loot boxes and the exchange rates for its virtual currency. The company must also delete any personal information it collected from children under 13 and ensure compliance with COPPA regulations moving forward.