The 1720 English speculative bubble centered on a company trading rights to South American commerce was the South Sea Bubble.
The South Sea Company received a government-backed monopoly over trade with parts of Spanish South America and proposed taking over portions of Britain’s national debt. Its shares rose dramatically as investors expected profits from trade and from the company’s relationship with the government.
The company’s actual trading prospects were much smaller than public enthusiasm suggested. As share prices climbed, promoters and investors joined a speculative rush, and many other bubble companies appeared. Parliament later investigated corruption and misleading promotion after the market collapsed.
The South Sea Bubble is often discussed alongside France’s Mississippi Bubble, which also burst in 1720. They were separate schemes, although both reflected the era’s enthusiasm for paper finance, government debt conversion, monopoly privileges, and rapidly rising share prices.