The 1720 speculative episode involving the South Sea Company was the South Sea Bubble.
The South Sea Company received a British government monopoly over trade with Spanish South America, although its actual commercial prospects were far more limited than many investors believed. Its shares rose dramatically as political influence, promotional claims, and speculation attracted buyers.
The price collapsed later in 1720, ruining many investors and causing a major political scandal in Britain. Parliament investigated the company’s directors and associates, while the government reorganized its finances. Isaac Newton was among those who lost money, though the exact amount is debated.
The South Sea Bubble occurred alongside France’s Mississippi Bubble, associated with John Law. Both episodes are early examples of a financial bubble: prices rose far beyond underlying economic value before collapsing.