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Genshin Impact maker fined $20M over loot box deception (Update: Cognosphere statement)

The FTC penalized HoYoverse for misleading marketing around loot boxes and breaching child privacy laws.
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Published onJanuary 20, 2025

Samsung Galaxy S22 Plus Genshin Impact
Hadlee Simons / Android Authority
TL;DR
  • The FTC fined Genshin Impact developer HoYoverse $20 million for misleading loot box practices and violating children’s privacy laws.
  • The game allegedly deceived players about the cost and odds of obtaining rare prizes and collected data from children under 13 without parental consent.
  • HoYoverse must now block purchases by children under 16 without parental approval, disclose loot box odds, and comply with stricter privacy rules.

Update, January 20, 2025 (12:55 PM ET): Shortly after our original article below was published, Cognosphere released a statement regarding the FTC action. It reads as follows:

“Animation-style games and shows are well-received by global audiences and players across various ages. Genshin Impact is a popular free-to-play, anime-style game designed for older teens and adults. While we believe many of the FTC’s allegations are inaccurate, we agreed to this settlement because we value the trust of our community and share a commitment to transparency for our players. Under the agreement, we will introduce new age-gate and parental consent protections for children and young teens and increase our in-game disclosures around virtual currency and rewards for players in the U.S. in the coming months.”


Original article, January 17, 2025 (05:02 PM ET): The Federal Trade Commission (FTC) has reached a settlement with the makers of Genshin Impact over allegations of deceptive marketing practices and violations of children’s privacy laws. The agreement requires Cognosphere, also known as HoYoverse in the US, to pay $20 million and implement strict changes to its policies.

An FTC press release on Friday accused the popular game developer of misleading children and other players about the cost and odds of obtaining rare in-game rewards, known as “five-star” loot box prizes. The complaint also alleged that HoYoverse violated the Children’s Online Privacy Protection Act (COPPA) by collecting personal data from children under 13 without parental consent.

The FTC’s complaint also highlighted how the game’s vibrant anime-style graphics and child-like characters appealed directly to younger audiences. Combined with aggressive promotional tactics and confusing virtual currency systems, these practices allegedly misled players into overspending on in-game purchases.

Genshin Impact on OPPO Find X8 Pro
Robert Triggs / Android Authority

“Genshin Impact deceived children, teens, and other players into spending hundreds of dollars on prizes they stood little chance of winning,” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection.

As part of the settlement, HoYoverse will have to implement several new practices. These include blocking children under 16 from purchasing loot boxes without parental consent, disclosing loot box odds and virtual currency exchange rates, offering players a direct payment option for loot boxes, and deleting data collected from children under 13 unless parental consent is obtained.

The settlement still requires federal court approval, but it serves as a warning to game developers who employ shady tactics to target children and teens.

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