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

Hoyoverse, the publisher of the popular game Genshin Impact, has reached a $20 million settlement with the Federal Trade Commission (FTC). The settlement includes a ban on selling loot boxes to users under 16 without parental consent.

The FTC's press release states that Hoyoverse will pay the fine and implement measures to prevent underage purchases. This action follows allegations that the company misled players, particularly children and teens, regarding the odds of winning in-game prizes and the overall cost of obtaining them.

Samuel Levine, Director of the FTC's Bureau of Consumer Protection, criticized Hoyoverse's "dark pattern tactics," stating that companies employing deceptive practices will face consequences. The FTC's primary claims center on Hoyoverse's alleged violation of the Children's Online Privacy Protection Rule (COPPA) through the collection of children's personal information and misleading representations of loot box odds and costs.

The FTC alleges Genshin Impact's virtual currency system was designed to be confusing and unfair, leading to significant, undisclosed spending by players, especially children, in pursuit of rare "five-star" prizes.

In addition to the financial penalty and the sales restriction, the settlement mandates that Hoyoverse publicly disclose loot box odds and virtual currency exchange rates, delete personal data collected from children under 13, and ensure future compliance with COPPA regulations.