Genshin Impact maker Cognosphere will pay a $20 million fine and change how it sells loot boxes in order to settle charges brought against it by the Federal Trade Commission (FTC).

The allegation that Genshin Impact misleads children about the odds of winning "Five-Star Prizes" in part relates to the Event Banners and "influencer campaigns", which the FTC says "give players the impression that they will have better odds of obtaining the five-star prize being promoted than they have in reality."

The FTC says "Genshin Impact deceived children, teens, and other players into spending hundreds of dollars on prizes they stood little chance of winning."

Genshin Impact publisher Hoyoverse has agreed to a settlement with the United States Federal Trade Commission where it agrees to pay a $20 million fine, and be banned from sellling lootboxes to teenagers under the age of 16.

The FTC's complaint alleges that Singapore-based Cognosphere deceived children and other users about the real costs of in-game transactions and the odds of obtaining rare prizes.

The Federal Trade Commission announced on Friday that Genshin Impact developer Cognosphere has agreed to a $20 million settlement and several restrictions on how it sells its loot boxes and manages children’s personal data.

The FTC penalized the Genshin Impact developer for misleading marketing around loot boxes and breaching child privacy laws.