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

Genshin Impact developer Hoyoverse has agreed to a $20 million settlement with the Federal Trade Commission (FTC). This settlement includes a ban on selling loot boxes to players under 16 without parental consent.

The FTC press release states that Hoyoverse will pay the $20 million fine and implement measures to prevent underage in-app purchases without parental authorization. Samuel Levine, Director of the FTC’s Bureau of Consumer Protection, stated that Genshin Impact misled players, particularly children and teens, into spending significant sums on in-game prizes with low win probabilities. He emphasized the FTC’s commitment to holding companies accountable for deceptive practices targeting young consumers.

The FTC alleges Hoyoverse violated the Children’s Online Privacy Protection Rule (COPPA) by marketing Genshin Impact to children and collecting their personal information without proper consent. Further allegations include misleading players about the odds of winning “five-star” loot box prizes and the overall cost of obtaining them. The FTC claims the game's virtual currency system was designed to be confusing and unfair, obscuring the high cost of acquiring desirable in-game items, leading to substantial spending by children.

In addition to the fine and the ban on loot box sales to minors, Hoyoverse must disclose loot box odds and virtual currency exchange rates, delete personal information collected from children under 13, and ensure future compliance with COPPA regulations.