$20 million. That’s the price HoYoverse is paying for its gacha system in Genshin Impact. The U.S. Federal Trade Commission (FTC) has issued this record-breaking fine, citing “deceptive” monetization practices that misled players, particularly minors. With over 65 million monthly active players worldwide, Genshin Impact has redefined success in the gaming industry—but at what cost?
This unprecedented action signals a shift in regulatory scrutiny for digital monetization strategies, leaving developers and players alike questioning the future of loot boxes and gacha mechanics.
FTC Slaps HoYoverse with $20 Million Fine Over Gacha System
The FTC’s investigation into Genshin Impact revealed a troubling pattern: players were spending real money on loot boxes without fully understanding the costs or odds. The game’s complex virtual currency system, which allows players to purchase random items or characters, was found to obscure the financial implications of these transactions.
The $20 million fine levied against HoYoverse (operating as Cognosphere in the U.S.) aims to hold the publisher accountable for these deceptive practices. It also sets a clear precedent for the gaming industry: lack of transparency in monetization systems will not go unchecked.
Parental Consent: A Game-Changer for In-Game Purchases
As part of the settlement, the FTC now mandates parental consent for in-app purchases (IAPs) made by players under 16. This measure is a response to concerns about the game’s appeal to younger audiences, who may not grasp the financial risks tied to gacha mechanics.
HoYoverse is required to:
- Implement stricter age verification systems to prevent unauthorized purchases.
- Provide clear, upfront information about drop rates and real-money costs for virtual items.
- Offer robust parental controls to ensure minors’ spending is monitored.
These changes aim to curb the exploitation of vulnerable players, reshaping the landscape of monetization practices in the gaming industry.
Players Demand Broader Accountability
While some gamers welcome the FTC’s decision, many argue that the ruling highlights a double standard. Critics point to Western gaming giants like EA, whose loot box mechanics in FIFA games have long faced accusations of being more exploitative.
Unlike Genshin Impact, FIFA’s loot boxes often fail to disclose individual drop rates, leaving players in the dark about their chances of acquiring high-value items. This inconsistency in regulatory enforcement has sparked debates over fairness and bias in the gaming community.
What This Means for the Gaming Industry
The FTC’s crackdown on HoYoverse sends a strong message to developers: transparency and fairness are non-negotiable. For the gaming industry, this case could:
- Set a new standard for gacha mechanics by requiring clear disclosures.
- Inspire further regulations targeting exploitative monetization practices.
- Encourage developers to prioritize consumer protection, particularly for minors.
For players, this ruling underscores the importance of staying informed about in-game spending. Understanding how gacha systems work—and their associated risks—can help consumers make more informed decisions.
