The South Sea Bubble was the 1720 speculative bubble centered on the South Sea Company in Britain.
The company received a government-backed monopoly over trade with parts of Spanish South America, although its realistic trading prospects were far more limited than investors imagined. It also took over portions of Britain's government debt, encouraging speculation in its shares.
The share price rose dramatically during 1720 as investors chased easy profits and promoters advertised extravagant expectations. It then collapsed later that year, ruining many investors and causing a political scandal. Parliament investigated corruption and financial misconduct, and several prominent figures were implicated.
The South Sea Bubble unfolded alongside the Mississippi Bubble in France, associated with John Law's financial system. The two episodes are sometimes discussed together as an early international speculative crisis, but they were separate schemes with different companies and governments.