Bank of Italy models Ethereum risks if ETH value collapses

The Bank of Italy modeled the extreme scenario of Ether going to zero to show how market risk in Ethereum’s native token can turn into infrastructure and financial stability risks.

The Bank of Italy has modeled what would happen to Ethereum’s security and settlement capacity if the price of Ether fell to zero, treating the network as critical financial infrastructure rather than just a speculative crypto asset.

In a new research paper titled “What if Ether Goes to Zero? How Market Risk Becomes Infrastructure Risk in Crypto,” Bank of Italy economist Claudia Biancotti examines how an extreme price shock in Ether (ETH) could affect Ethereum‑based financial services that rely on the network for transaction processing and settlement.

Biancotti focuses on the link between validators’ economic incentives and the stability of the underlying blockchain used by stablecoins and other tokenized assets.

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