The 18th-century speculative bubble involving the South Sea Company was the South Sea Bubble.
The South Sea Company was founded in England in 1711 and received a government-backed trading monopoly connected with Spanish South America. In practice, its commercial opportunities were far more limited than many investors imagined. Share prices rose dramatically in 1720 as promotional claims, easy credit, and speculative enthusiasm attracted buyers.
The price then collapsed later in 1720, ruining many investors and causing a major political scandal. Parliament investigated the company’s conduct, and several prominent figures were implicated in corruption. The South Sea Bubble is often discussed alongside France’s Mississippi Bubble because both burst in 1720, but they were separate schemes. The episode helped establish the enduring meaning of “bubble” for an asset price driven far beyond underlying economic prospects.