The British company that became the namesake of the 1720 stock-market bubble was the South Sea Company.
Founded in 1711, the South Sea Company received a government monopoly over British trade with Spanish South America in exchange for taking on part of the national debt. Its actual commercial opportunities were far smaller than promotional claims suggested, but its shares rose rapidly in 1720 as investors anticipated enormous profits.
The company’s share price climbed from about £128 in January 1720 to roughly £1,000 in August. It then collapsed, ruining many investors and causing a political scandal. Parliament investigated the company’s directors and allegations of bribery involving public officials.
The same speculative era also included the Mississippi Company bubble in France. These episodes are often grouped together as the “Bubble Act” period, although the Bubble Act was passed after the crisis and did not itself cause the South Sea Company’s initial rise.