The highly-rated shot-stopper has been consistently linked with a move to Anfield in recent weeks amidst the Reds' search to provide competition for Simon Mignolet, whose poor form has been criticised this season.
However, reports suggest City would be Ter Stegen's preferred destination if he were to complete a move to the Premier League in order to play under Pep Guardiola.
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The German has previously voiced his desire to move away from the Camp Nou in search of greater first-team football, so to hear him wanting a move to the Etihad, where he would compete with England number one Joe Hart, is somewhat confusing.
Ter Stegen is widely regarded as one of Europe's best young 'keepers having made more than 100 starts for Germany's Borussia Monchengladbach before his 21st birthday, yet he has played just four times in La Liga since joining Barcelona in 2014.
While Hart's position as City's number one is under no immediate threat, the arrival of Guardiola as manager this summer could lead to an investigation into the worth of each player at the Etihad and their ability to fit into the Spaniard's desired system.
As for Liverpool, Mignolet has often been the subject of scrutiny for his lacklustre performances yet received a new contract before Christmas, contradicting manager Jurgen Klopp's intentions to sign a new goalkeeper.
However, competition is key at the top level, suggesting an able alternative on Merseyside is just what's needed to bring the best out of the Belgian.