Genshin Impact banned from selling lootboxes to young teens; gets hit with $20m USD fine

Game developer Cognosphere says "the FTC's are inaccurate".

Genshin Impact developer Cognosphere has agreed to pay a $20 million USD fine and will block children under 16 from buying in-game lootboxes after allegations filed by the US Federal Trade Commission (FTC).

According to the FTC, its complaint “charged that HoYoverse [which is the name Cognosphere operates under in the USA] deceived players about the odds of winning particular sought-after ‘five-star’ loot box prizes and how much it would cost to open loot boxes to win the prizes.”

The FTC “also alleged that the confusing virtual currency system that players had to navigate to open loot boxes and the marketing and promotion tactics used to entice players to open loot boxes were unfair to children and teenagers.”

Cognosphere has agreed in a settlement on that $20 million USD fine, and will also be “prohibited from selling loot boxes using virtual currency without providing an option for consumers to purchase them directly with real money.”

Cognosphere confirmed the settlement details and also issued a larger statement on the matter.

“Animation-style games and shows are well-received by global audiences and players across various ages,” it began. “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,” it continued.

Genshin Impact is available on Windows PC, PS4, PS5, iOS, and Android.