Abstract: The emergence of disruptive cryptocurrency platforms and decentralized finance (DEFI) has revolutionized the financial landscape over the last couple of years. Against this backdrop, and in view of the limited opportunities for diversification in the conventional assets, it becomes evident for the investors to look for better opportunities by searching for rather non-conventional assets like cryptocurrencies as a means of portfolio diversification. This study analyses the major cryptocurrencies based on their market capitalization and the major markets from MENA regions to evaluate the potential of cryptocurrencies in portfolio diversification. The study employs the mean-variance approach and then compares the results with the higher-order moments. We found that cryptocurrencies offer considerable potential for diversification for the MENA markets, but these exposures must be conservatively given the explosive price evolution and extreme volatility of the cryptocurrencies. The results also suggest that cryptocurrencies do not considerably contribute to the portfolio diversification in the uncertain market movements and crises, such as that witnessed during Fed's regime shift, accentuated by the Ukraine crisis.