Genshin Impact Dev Settles $20M Loot Box Fine

Genshin Impact's publisher, Hoyoverse, has reached a significant settlement with the United States Federal Trade Commission (FTC), agreeing to pay a $20 million fine and implementing a ban on selling loot boxes to teenagers under the age of 16. In a press release, the FTC highlighted that Hoyoverse will also prevent children under 16 from making in-game purchases without parental consent, marking a pivotal step in safeguarding young players.

Samuel Levine, Director of the FTC's Bureau of Consumer Protection, stated that Hoyoverse misled children, teens, and other players into spending substantial sums on prizes with low winning odds. Levine emphasized that companies employing "dark-pattern tactics" to deceive players, particularly young audiences, will face consequences.

The FTC's primary allegations against Hoyoverse include violations of the Children's Online Privacy Protection Rule (COPPA). They claim Hoyoverse marketed Genshin Impact to children, collected their personal information, and deceived players about the chances of winning coveted "five-star" loot box prizes, as well as the costs associated with opening these loot boxes.

The FTC further criticized Genshin Impact's virtual currency system as confusing and unfair, arguing that it obscured the true cost of obtaining "five-star prizes," leading to children spending hundreds to thousands of dollars in pursuit of these items.

As part of the settlement, Hoyoverse must disclose loot box odds and the exchange rates for its virtual currency, delete personal information collected from children under 13, and adhere to COPPA regulations moving forward. This settlement underscores the FTC's commitment to protecting young consumers and ensuring transparency in gaming practices.