US FTC nears settlement with HoYoverse over Genshin Impact monetization practices

As an enthusiastic follower, I’m excited to share that it seems like the US Federal Trade Commission is on the brink of reaching a settlement with HoYoverse, the mastermind behind Genshin Impact, my beloved game. The focus of their investigation was primarily on the game’s monetization strategies, particularly its gacha system, where real-world money buys a chance to secure rare in-game characters or items. In this post, let’s delve into the discussion about the potential fine imposed by the US FTC on HoYoverse’s Genshin Impact for their Deceptive Gacha System.

FTC imposes a fine of $20 million fine on HoYoverse for its deceptive Gacha System

The U.S. Federal Trade Commission has penalized Cognosphere, the creators of the widely played game Genshin Impact, with a fine amounting to $20 million. This penalty was issued due to accusations that they deceived players regarding the expenses and probabilities linked to in-game loot boxes. The FTC’s examination uncovered that the game’s intricate virtual currency system made it difficult for players to understand the real-world financial consequences of making purchases.

This situation encourages both adult and minor gamers to invest substantial sums without fully grasping the possible rewards. The agreement emphasizes the Federal Trade Commission’s dedication to shielding consumers from misleading online earnings tactics, especially those aimed at young demographics.

New Regulations mandate Parental Consent for IAPs made by Minors

In accordance with the agreement reached with the FTC, Cognosphere is now obligated to establish robust safeguards to stop children under the age of 16 from making in-game purchases without clear parental approval. This move aims to address worries that the captivating visuals and childlike characters in Genshin Impact might attract younger players who may not fully grasp the financial consequences of in-game transactions.

To maintain fairness and safeguard younger gamers, the FTC intends to impose new rules that encourage game creators to prioritize the security of minors within their revenue strategies. This could serve as a model for future developments across the gaming industry. The uproar around Genshin Impact mainly revolves around its gacha system, where players spend real cash to acquire virtual currency, which can then be used unpredictably to get various in-game goods or characters.

Players question fairness in Gacha Game Policies

The fine levied on Genshin Impact developer Cognosphere has ignited a flurry of discussions among gamers, with many alleging that the FTC shows signs of inconsistency and favoritism. A common theme in these discussions is the striking disparity in enforcing regulations against Chinese companies such as Cognosphere while seemingly overlooking Western gaming titans like EA, whose loot box practices in FIFA are often criticized for being exploitative.

Critics contend that FIFA’s system, featuring unclear probabilities less than 1% and a lack of transparency for individual items, presents a significantly larger danger to consumers compared to the published drop rates and strict pity system in Genshin Impact.

Final Thoughts

The FTC’s move against Genshin Impact underscores increasing worries about openness and equitability within loot box mechanisms. This agreement paves the way for tighter rules to safeguard users, particularly young ones, but it also stirs debate on uniformity in regulation implementation across the gaming sector.

Many individuals are advocating for an equal examination of Western corporations that engage in comparable or even more predatory business methods within the gaming industry. This situation might signal a pivotal moment in the way governments oversee digital income generation in games, placing greater emphasis on fairness and responsibility among all developers.

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2025-01-18 15:11