Hibernian have confirmed that Victor Palsson has left the club, with his contract having been cancelled with immediate effect.
The 20-year-old reached a mutual agreement with the club, allowing him to take his career in a different direction.
Palsson joined Hibs from Liverpool in January 2011, penning an 18-month deal.
He was due to become a free agent in the summer, but he has been allowed to start his search for a new club earlier than anticipated.
The Icelandic midfielder leaves Easter Road having made 34 appearances and scored one goal.
A statement released on Hibs' official website read: "Everybody connected with Hibernian would like to wish Victor all the best as he embarks on the next chapter in his career and thank him for his contribution."