Cognosphere Fined $20 Million for Child Privacy Violations in Genshin Impact

HoYoverse, the developer of Genshin Impact, has agreed to pay a $20 million fine following allegations from the Federal Trade Commission (FTC) that the company misled children and teens regarding the costs of in-game purchases and the odds of winning rare items from loot boxes. The FTC found that the company violated the Children’s Online Privacy Protection Rule (COPPA) by collecting personal data from players under 13 without parental consent and aggressively marketing the game to minors. The settlement mandates that HoYoverse implement new age-gate and parental consent protections, ensure transparency in loot box odds and pricing, and delete previously collected personal data unless consent is obtained. The FTC emphasized the need for accountability among companies using deceptive practices, particularly those targeting younger audiences. Despite agreeing to the settlement, HoYoverse contended that many of the FTC's allegations were inaccurate but stated a commitment to transparency for players. Changes to the game's monetization and privacy practices are expected to be implemented in the U.S. market soon.