Genshin Impact Developer to Pay $20 Million to Settle FTC Charges

Genshin Impact Developer to Pay $20 Million to Settle FTC Charges

Singapore-based Cognosphere, the developer of the popular mobile game Genshin Impact, has agreed to pay a $20 million fine and face significant restrictions on its loot box sales practices. The Federal Trade Commission (FTC) announced on Friday that Cognosphere has reached a settlement to resolve allegations of deceptive and unfair business practices. The FTC contends that the company misled players, particularly children, about the odds of winning valuable in-game items through loot boxes, a controversial monetization model often compared to gambling. Key Accusations: Deceptive Loot Box Marketing: The FTC alleges that Cognosphere aggressively marketed loot boxes to children, employing tactics like social media campaigns and in-game banners. The company is accused of failing to transparently disclose the true odds of winning rare items, leading players to spend significant sums of money with little chance of obtaining desired rewards. Misleading Pricing and Currency Exchanges: The complai…