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A switch to Real Madrid appears to be the likely next move, with rumours suggesting a verbal agreement has already been established with the Spanish powerhouse.
Despite the fact that Alexander-Arnold's departure has seemed imminent for a while now, it still comes as a significant shock to Liverpool supporters.
The announcement has naturally elicited a strong reaction from fans, many of whom are displeased with Alexander-Arnold's silence throughout the season and the fact that he is leaving his childhood club on a free.
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However, Liverpool supporters have faced criticism from other parts of the football world.
Paul Merson and Rio Ferdinand are among the high-profile names who have criticised the reaction of the fans' recently, with more joining in after Alexander-Arnold's announcement.
Carragher has fiercely defended Liverpool fans' right to their own reactions, saying on Sky Sports Monday Night Football: "There's this thing that I've been reading throughout the day, obviously when the news breaks.
"You've got the reaction of Liverpool supporters, which are different.
I'm probably one of the ones who are somewhere in the middle.
"But I'm sick all day of reading about journalists, or other people who have got no affiliation to Liverpool, telling Liverpool supporters how they should feel.
"They're not Liverpool supporters.
Liverpool as a city and football club is very emotional, and that's what makes us what we are, and that's why you see the scenes that you saw last week when Liverpool won the league.
"You don't really see scenes for a team winning the league, because we are emotional, football means a lot to us.
I just wanted to mention that I don't think people out there should be telling Liverpool supporters how they should feel.
"Liverpool supporters, like Trent - he can do what he wants, it's his career, fine, good luck to him - but Liverpool supporters can also feel how they want about this situation."
This story first appeared on Liverpool.com