Genshin Impact distributor Cognosphere has agreed to pay $20 million to resolve charges brought by the US Federal Trade Commission.
In a complaint filed on January 17, 2025 in the United States District Court for the Central District of California, the FTC alleged that Cognosphere violated the Children’s Online Privacy Protection Act (COPPA) and deceived users about the cost of in-game transactions.
The FTC claimed that Cognosphere marketed Genshin Impact to children under 13 and collected personal information without parental consent, which violates COPPA.
It also alleged that Cognosphere “misled players about the odds of winning” loot box prizes and that the in-game currency purchasing process is too confusing for consumers. He stated that this misleads players regarding “the amount of money that would likely need to be spent to obtain certain prizes.”
Under the proposed order, Cognosphere must comply with the changes outlined in the complaint, including prohibiting the sale of loot boxes to children under 16 without parental consent and rectifying misrepresentations of the loot boxes’ odds, prices and features. of loot.
In response to the lawsuit, Cognosphere said that while it believed “many of the FTC’s allegations are inaccurate,” it agreed to the settlement because it “values the trust of [its] community and shares a commitment to transparency to [its] players.”
“Under the agreement, we will introduce new age and parental consent protections for children and teens and increase our in-game disclosure about virtual currency and rewards for players in the US in the coming months,” he said.
FTC Bureau of Consumer Protection Director Samuel Levine added: “Genshin Impact tricked children, teenagers, and other players into spending hundreds of dollars on prizes they had little chance of winning.
“Companies that implement these shady tactics will be held accountable if they mislead players, especially children and teenagers, about the true costs of in-game transactions.”
Cognosphere is a subsidiary of Chinese developer MiHoYo and publisher of Genshin Impact. It does business in the United States as HoYoverse.
