FTC says Genshin Impact ‘deceived children’ and orders its publisher to pay a $20 million fine and stop selling loot boxes to kids

Genshin Impact publisher Cognosphere (another name for HoYoverse) has agreed to pay a $20 million fine and will block children under the age of 16 from making in-game purchases without parental consent in settlement with the US Federal Trade Commission over allegations that it violated the Children’s Online Privacy Protection Act (COPPA) and “deceived children and other users about the real costs of in-game transactions and odds of obtaining rare prizes.”

Although Cognosphere has accepted the fine, it says that “many of the FTC’s allegations are inaccurate.”

A complaint filed by the US Department of Justice alleged that Cognosphere—operated as HoYoverse in the US—”actively marketed” Genshin Impact to children and collected personal information from them in violation of COPPA rules, deceived players about the odds and costs of winning prizes in loot boxes, and uses a “challenging and confusing” purchasing system that “misleads consumers about the amount of money that players spend on loot boxes on an ongoing basis, and the amount of money that players would likely need to spend to obtain certain prizes.”

“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. “Companies that deploy these dark-pattern tactics will be held accountable if they deceive players, particularly kids and teens, about the true costs of in-game transactions.”

Dark patterns, also called dark design, is a term for elements of a UI that are purposely designed to be deceptive, typically with the goal of tricking users into doing things unintentionally—buying stuff, mostly. It’s a growing concern in the videogame industry: In 2022, Epic Games reached a $520 million settlement with the FTC over a complaint that included allegations of dark pattern usage in Fortnite, and attorney Eric Weiss told PC Gamer in 2024 that game makers should be “exceedingly careful” with their designs because of increasing FTC vigilance. But dark patterns are out there in the wider world, too. In 2023, for instance, the FTC filed a complaint against Amazon for using “manipulative, coercive, or deceptive user-interface designs known as dark patterns to trick consumers” into signing up for automatically-renewing Prime memberships.

Under the terms of the settlement, which must first be approved by a federal judge, Cognosphere will pay a $20 million fine and make the following changes to Genshin Impact:

• Children under 16 will not be allowed to purchase loot boxes without parental consent.
• All loot boxes available for purchase with virtual currency will also be made available for direct purchase using real money.
• Loot box odds and exchange rates for “multi-tiered virtual currency” will be accurately disclosed and not misrepresented.
• Any personal information collected from players under the age of 13 will be deleted, unless permission to keep the data is obtained from parents.
• All COPPA regulations, “including its notice and consent requirements,” will be complied with.

“Genshin Impact is a popular free-to-play, anime-style game designed for older teens and adults,” Cognosphere said in a statement. “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.”