Written by Kanishka Singh
WASHINGTON (Reuters) – Cognosphere, publisher of fantasy video game Genshin Impact, has agreed to pay $20 million to settle allegations by the U.S. Federal Trade Commission that the company violated a children's privacy law.
The FTC said it will also prevent children under 16 from making in-game purchases without parental consent as part of the settlement.
The Federal Trade Commission accused Singapore-based Cognosphere of unfairly marketing loot boxes to children, obscuring true costs and misleading all players about the odds of winning prizes.
The game is produced by Chinese developer MiHoYo.
“Although we believe many of the FTC’s allegations are inaccurate, we agreed to this settlement because we value our community’s trust and share a commitment to transparency with our players,” Cognosphere said in a statement.
The company said it will introduce new age-gating protections and parental consent for children and younger teens and will increase in-game disclosures about virtual currency and rewards for players in the United States in the coming months.
