Real Madrid have reportedly admitted that they cannot sign Trent Alexander-Arnold this month.
Liverpool star Alexander-Arnold, 26, has been the subject of intense speculation in recent times, with the defender – alongside Virgil van Dijk and Mohamed Salah – out of contract at the end of the season.
Liverpool remain in negotiations with all three stars, but no breakthrough has been achieved as the months pass, and the players could talk to foreign clubs about a free transfer in the summer.
Alexander-Arnold's future is under intense pressure, with the 26-year-old heavily linked with Real at a time when the defender's form has taken a dip.
Carlo Ancelotti's side are confident they can sign Alexander-Arnold and pursued the defender in January, submitting a £20million bid that was quickly rejected.
But according to Spanish newspaper Relevo, Real have now given up on signing Alexander-Arnold this month after realizing how difficult it is to get a deal done.
It is recognized that it would be 'practically impossible' to arrange a move for several reasons.
This is despite mounting pressure on Ancelotti following Real's 5-2 defeat to Barcelona in the Spanish Super Cup final on Sunday, with calls for reinforcements among the club's fanbase.
The report adds that Liverpool remain desperate to keep Alexander-Arnold and have not given up hope of convincing him to sign a new contract, even though they would not accept a substantial offer for the defender this month.
Meanwhile, Alexander-Arnold will also not force an exit from Anfield given his status as a Liverpool academy graduate and idol of the fanbase.
The benefits of retaining him as Arne Slot's side in all four competitions are also seen as extremely important by the Reds.
However, the Spanish giants are still desperate to sign Alexander-Arnold and the focus has shifted to signing him in the summer, with Real hoping to land the defender in time for the Club World Cup.
The report adds that Ancelotti's side are extremely confident that they will be able to complete a summer move for their number 1 goal, and there is a belief that Alexander-Arnold will be the heartbeat of the team for the next decade.
A move to a free agent would similarly follow the club's strategy in recent periods, after David Alaba, Antonio Rudiger and Kylian Mbappe all moved to the Bernabeu at the end of their contracts.
As part of the Club World Cup rules, there will be a registration window in June for clubs to add players to their squad for the tournament, something Real have in mind for the Englishman.
The report even claims that Los Blancos believe Alexander-Arnold could be presented at the Bernabeu before flying to the United States for the showpiece event, which runs from June 15 to July 13.
There is hope on Real's part that Dani Carvajal, who is currently absent with a knee injury, will also return by then, giving Ancelotti a good option for both the Spaniard and Alexander-Arnold at right-back.
Real are back in action on Thursday when they entertain Celta Vigo in LaLiga, with Ancelotti's side currently in second place and one point behind rivals Atletico.