Balde has agreed terms on a new five-year contract that will officially be signed on Thursday.
The 19-year-old's previous contract would have expired next summer.
Barcelona will include a mammoth €1b release clause in Balde's new deal to fend off potential suitors.
A product of Barcelona's famed La Masia academy, Balde made his first team debut in the 2021/2022 season but became a regular for the senior side last term, making 44 appearances across all competitions as Xavi Hernandez's side won La Liga.
He has since made 55 appearances in total for Barcelona, scoring one goal.
An official statement from Barcelona read: “FC Barcelona and the player Alejandro Balde have reached an agreement for a new contract which will take the player through to 30 June 2028.
“The buy out clause is set at 1bn euros.”
Balde has also gained international recognition with Spain as he was a late call up for the World Cup squad last year. He has since won six caps for La Roja.
