FTC Fines HoYoverse $20 Million Over Child Privacy Violations

HoYoverse, the developer behind Genshin Impact, has agreed to pay a $20 million fine to the Federal Trade Commission (FTC) following allegations of violating children's privacy laws and misleading users about the costs and odds associated with in-game transactions. The FTC accused HoYoverse of employing deceptive practices, particularly targeting minors, by obscuring the true costs of its gacha system and failing to obtain parental consent for collecting personal data from children under 13. As part of the settlement, HoYoverse will block users under 16 from making in-game purchases without parental approval. FTC Director Samuel Levine emphasized that companies using 'dark-pattern' tactics will be held accountable for deceiving players, especially younger audiences. The settlement will also require HoYoverse to implement changes to its marketing and purchasing processes to prevent further violations of the Children's Online Privacy Protection Act (COPPA). This case highlights growing concerns about the use of gambling-like mechanics in video games and the responsibility of developers to protect vulnerable players.