The 1720 British speculative bubble was the South Sea Bubble.
The South Sea Company received a government-backed monopoly over trade with parts of Spanish South America, although its realistic trading opportunities were limited. Investors became excited when the company offered to take over part of Britain’s national debt and its shares rose dramatically in 1720.
Speculation spread beyond the company itself. New joint-stock ventures were promoted, and Parliament passed the Bubble Act in June 1720, partly restricting unchartered companies. Confidence reversed later that year, the South Sea share price collapsed, and many investors suffered severe losses.
The South Sea Bubble is often discussed alongside the Mississippi Bubble in France, which also burst in 1720. They were separate schemes, although both demonstrated how credit, promotional claims, and crowd psychology could inflate asset prices far beyond underlying business prospects.