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.
The FTC's press release states that Hoyoverse will pay the fine and implement measures to prevent underage in-app purchases. This action follows accusations that the company employed deceptive practices, misleading players, particularly children and teens, into spending significant sums on in-game items with low odds of winning valuable prizes.
Samuel Levine, Director of the FTC's Bureau of Consumer Protection, criticized Hoyoverse's tactics, highlighting the company's alleged use of "dark patterns" to deceive players. He emphasized the FTC's commitment to holding companies accountable for such practices.
The FTC's primary allegations against Hoyoverse center on violations of the Children's Online Privacy Protection Rule (COPPA). These include marketing Genshin Impact to children, collecting their personal information without proper consent, and misrepresenting the odds of winning "five-star" loot box prizes. The FTC also contends that the game's virtual currency system was designed to be confusing and unfair, leading to substantial unexpected spending by players, especially children.
As part of the settlement, Hoyoverse must:
- Pay a $20 million fine.
- Prohibit the sale of loot boxes to users under 16 without parental consent.
- Clearly disclose loot box odds and virtual currency exchange rates.
- Delete personal information collected from children under 13.
- Comply with all COPPA regulations moving forward.
