The South Sea Bubble was the 1720 stock-market crash triggered by the collapse of the South Sea Company’s shares in Britain.
The company received a monopoly over British trade with parts of Spanish America, although the commercial opportunities were far more limited than promotional claims suggested. Its stock price soared as investors bought shares amid speculation, political influence, and schemes allowing people to subscribe with borrowed money.
Shares reached roughly £1,000 in August 1720 before collapsing later that year. The crash ruined many investors and exposed corruption involving politicians and company insiders. Parliament investigated the scandal, and the episode helped shape British suspicion of speculative bubbles. The contemporaneous Mississippi Bubble in France was a separate but related financial episode associated with John Law. Tulip mania occurred in the Dutch Republic during the seventeenth century, well before the South Sea Bubble.