Genshin Impact Dev Hit with $20M Fine for Loot Box Issues

Genshin Impact's publisher, Hoyoverse, has settled with the U.S. Federal Trade Commission (FTC) by agreeing to pay a $20 million fine for allegedly violating children’s privacy laws through its loot box system. The FTC claims the game deceived players, particularly minors, into spending significant amounts on in-game purchases without adequate disclosure of odds or spending requirements. As part of the settlement, Hoyoverse must prevent players under 16 from making purchases without parental consent, disclose loot box odds, and remove personal information collected from children under 13, aligning with the Children’s Online Privacy Protection Rule (COPPA).

This settlement serves as a warning to other game developers about the importance of transparency and responsible marketing practices, particularly regarding loot boxes and in-game purchases targeting young players. Companies may need to review their practices to avoid similar legal issues and fines.

Genshin Impact, an action RPG developed by Hoyoverse, has gained massive popularity since its release in September 2020. Featuring a vast open-world environment and a gacha system for acquiring characters and weapons, it has drawn both praise for its gameplay and criticism for its monetization practices. With this settlement, the game's developers will likely adjust their approach to comply with legal standards while maintaining a safe gaming environment for younger audiences.