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 children 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 follows allegations that the company misled players, particularly children and teens, about the odds of winning in-game prizes and the costs involved.
Samuel Levine, Director of the FTC's Bureau of Consumer Protection, criticized Hoyoverse's "dark-pattern tactics," stating that companies employing such deceptive practices will face consequences. The FTC's primary claims center on Hoyoverse's alleged 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.
The FTC alleges 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 winning coveted "five-star" prizes. The agency cites instances of children spending hundreds or even thousands of dollars.
In addition to the financial penalty and 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.
