Woodburn burst onto the scene last term, scoring in the League Cup against Leeds and playing nine times for the senior team overall.
But this year has been more about developing in training and with the U-23s, with Woodburn seeing first-team action just once.
It has led to a surge in interest in the 18-year-old with Championship sides hoping to snare his services for the second half of 2017/18.
Sunderland were the front-runners, with Chris Coleman—previously Woodburn’s boss with the Wales national team—having taken over as manager at the Stadium of Light.
But Sky Sports now report the deal is off, with Woodburn set to stay at Anfield.
He can feature as a second forward, a wide option or even as a No. 8 creative midfielder—all roles Coutinho took up this term prior to his departure to La Liga.
He has also captained the Reds in the UEFA Youth League, where they won five of the six group games.