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.
In an FTC press release, the agency stated that Hoyoverse will pay the fine and implement measures to prevent underage in-app purchases. This follows allegations that the company misled players, particularly children and teens, regarding the odds of winning valuable in-game items ("five-star" prizes) from loot boxes. The FTC also claimed the virtual currency system was designed to be confusing and unfair, leading to significant, often unexpected, monetary expenditures.
FTC Bureau of Consumer Protection Director Samuel Levine emphasized that companies employing deceptive "dark pattern" tactics will face consequences. He highlighted the significant sums spent by children and teens attempting to obtain these rare items.
Beyond the financial penalty and sales restriction, Hoyoverse is mandated to:
- Clearly disclose the odds of winning loot box prizes.
- Disclose the exchange rates for its virtual currency.
- Delete personal information collected from children under 13.
- Ensure future compliance with the Children's Online Privacy Protection Rule (COPPA).
This settlement underscores the FTC's commitment to protecting children and holding companies accountable for deceptive marketing practices within the gaming industry.
