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 players under 16 without parental consent.
In an FTC press release, the agency stated that Hoyoverse will pay the fine and implement measures to prevent underage in-app purchases. This action follows allegations that the company misled players, particularly children and teens, about the odds of winning in-game prizes and the costs associated with loot boxes.
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 against Hoyoverse center on violations of the Children's Online Privacy Protection Rule (COPPA) through the collection of children's personal information and deceptive marketing practices regarding loot box odds and virtual currency systems.
The FTC argued that Genshin Impact's virtual currency system was designed to be confusing and unfair, leading players to spend significant sums of money with little chance of obtaining rare "five-star" prizes. The agency cited instances of children spending hundreds or even thousands of dollars.
In addition to the financial penalty and the sales restriction, the settlement requires Hoyoverse to:
- Publicly disclose the odds of winning loot box prizes and the exchange rates for virtual currency.
- Delete personal information collected from children under 13.
- Comply with all COPPA regulations moving forward.
