What was the 1720 British market crisis involving the South Sea Company called?

The 1720 British market crisis involving the South Sea Company was called the South Sea Bubble.

The South Sea Company received a government-backed monopoly over trade with Spanish South America, although its actual trading prospects were limited. In 1720, the company proposed converting much of Britain’s government debt into its shares, creating powerful political and financial incentives for investors to buy.

Its share price rose dramatically during the year, attracting wealthy investors and members of the public. Parliament also passed the Bubble Act, which restricted rival joint-stock companies and intensified speculation. When confidence weakened, the share price collapsed, ruining many investors.

The South Sea Bubble is often discussed alongside France’s Mississippi Bubble, which burst in the same period. It was not the first speculative boom in history, but it became one of the best-known examples of an early modern stock-market bubble and financial scandal.