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 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, and the overall cost involved.

Samuel Levine, Director of the FTC's Bureau of Consumer Protection, criticized Hoyoverse's practices, stating they employed "dark-pattern tactics" that deceived players into spending significant sums of money on items with low win probabilities. He emphasized the FTC's commitment to holding companies accountable for such deceptive practices targeting young people.

The FTC's complaint alleges that Hoyoverse violated the Children's Online Privacy Protection Rule (COPPA) by collecting personal information from children without parental consent and by employing misleading marketing tactics. The complaint also highlights the confusing and unfair nature of Genshin Impact's virtual currency system, which allegedly obscured the high cost of obtaining rare items.

As part of the settlement, Hoyoverse must:

• Pay a $20 million fine.
• Prohibit the sale of loot boxes to children 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.

This settlement underscores the FTC's ongoing efforts to protect children and teens from deceptive in-app purchasing practices within the gaming industry.