Barella is believed to be closing in on a move to Stamford Bridge after the departure of Cesc Fabregas to Monaco.
Many consider the 21-year-old to be one of Italy's brightest young prospects and it's been reported that he could cost the Blues as much as £45 million ($58m) this month.
But iconic Italian forward Cassano, who retired last October, believes it would be "madness" for Chelsea to spend so much on Barella.
"Unfortunately today football is going in a very wrong direction," Cassano said in an interview with Sky Sports Italy.
"Barella is worth 50 million euros? OK, so how much is Thiago Alcantara of Bayern Munich?
"He [Thiago] is young too, he is 27 years old. He is worth at least four or five times more than Barella.
"A player makes two good games, he runs right and left, maybe he is also a player of quantities like Allan or Barella, and then he is worth immediately 50, 60, 80 million?
"For me it is madness."
Aged just 19, the exciting attacking midfield player netted his first goal for the club on Boxing Day, with some even comparing him to Roma great Francesco Totti.
Cassano, though, has laughed off that comparison, despite stating his admiration for Zaniolo.
"I saw him [Zaniolo] play a couple of games, he's good, but he's still young," he added.
"We're not making comparisons with Totti, he's a different player from the classic natural talent, in the sense that he's very physical, he must be physically fit to play.
"He has good quality, he has room for improvement and he has personality. I still haven't figured out if he's a midfielder or a forward, but I like him."