For HODLers of crypto, the last couple months have been quite the test of endurance.

The price of Bitcoin and Ethereum, the two top digital assets by market cap, dropped over 40% each since mid-November, according to CoinMarketCap (Bitcoin hit an all-time high of roughly $69,000 in November before sinking to around $36,900 as of January 21 afternoon trading). In recent days, the price of Bitcoin has fluctuated around the $40,000 mark, but on January 21 crashed to under $37,000—a level below which "there is not much support until the $30,000 level," Edward Moya, senior market analyst at Oanda, argued in an early January 21 afternoon note.

Big drops in the price of coins like Bitcoin are certainly nothing surprising for longer-term crypto investors, but Jeff Dorman, the chief investment officer at crypto investment firm Arca, suggests there are signs of waning confidence in the stalwart digital asset. "There's been outflows," Dorman notes. "There's certainly been a little bit of a cool down in terms of interest in Bitcoin specifically."

Since hitting its all-time high in November, Bitcoin has plunged alongside the broader market, in particular riskier assets like growth and tech stocks (the tech-heavy Nasdaq recently fell into correction territory, defined as a 10% drop, and continued to sink on January 21). The correlation between Bitcoin and assets like tech stocks is not a new trend, though it has grown stronger in recent weeks: According to Bloomberg data, the 100-day correlation between the Nasdaq Composite and Bitcoin is at 0.47, up from around 0.30 in late November.

As many have pointed out over recent weeks, the big reason why cryptos like Bitcoin are falling alongside tech stocks, experts argue, is the Federal Reserve's more hawkish turn in its November meeting, indicating an accelerated pace of tapering and rate hikes—a shift away from policies that buoyed crypto since 2020. "The Fed clearly misread the [inflation] situation and they're now having to go aggressive with Fed tightening, and this has sent Treasury yields skyrocketing," Moya told Fortune (the 10-year yield hit as high as 1.9% this week, though it has since retreated to under 1.8%). "That's not good for risky assets; Bitcoin, for the most part, is the riskiest asset of them all."

Arca's Dorman notes that everything from Cathie Wood's ARK Innovation ETF to SPACs, recent IPOs, and Bitcoin are "all getting hammered and they've gone pretty much straight down in line with those Fed rate expectations." The recent crash also put cracks into the argument that Bitcoin serves as a hedge against inflation.

"Regardless of what Bitcoin is supposed to be, it is being traded right now as a macro risk indicator by a bunch of macro funds and governments and traditional financial institutions," Dorman suggests. "That's going to dominate the short term narrative," though he doesn't believe that will always be the case.

Meanwhile diversification may also be a factor in Bitcoin's slump. Traders are "going to other alt coins that people are betting ... are going to be the key rivals that take on Ethereum as far as becoming the next big blockchain," notes Moya, pointing to Solana, Polkadot, Cardano, and Avalanche, to name a few (those coins have also taken a hit lately). "The diversification trade has really hurt Bitcoin," he argues.

Moya also suggests the global energy crisis and Russia's threat to ban the use and mining of Bitcoin on January 20 may be "complicating Bitcoin's attempt to stabilize."

Where is crypto headed?

As to where crypto is headed from here, a lot depends on which coin you're talking about.

Oanda's Moya believes Bitcoin is likely to remain volatile in the next couple of months, suggesting that from a technical standpoint, it might trade in the $35,000 to $50,000 range during the first quarter of this year. After that, he expects the crypto to find more stable ground after the Fed's second rate hike this year, and end 2022 in a better spot (he estimates possibly around $60,000). Moya believes Ethereum, meanwhile, should rebound and trade above $4,000 this year (it's currently trading around $2,600), but points out Ethereum is losing marketshare in NFTs, and he's unsure it will "have an easy run" to $5,000.

For Yuya Hasegawa, a crypto market analyst at Japanese crypto exchange Bitbank, Bitcoin's near-term path "really depends on next week's [Federal Open Market Committee] meeting," he told Fortune. He sees the coin's potential bottom this year to be somewhere around $28,000, which was roughly its bottom price in 2021, according to Hasegawa and crypto research and data firm Messari (though he believes Bitcoin can rebound to trade between $60,000 and $80,000 by year's end).

Kevin Kelly, the head of markets and macro at crypto research firm Delphi Digital, also expects Bitcoin to be on a bumpier path: he told Fortune via email that he expects "the crypto market to struggle in the short to medium-term," adding that "the latest sell off the last 24 [hours] was a bit quicker than we initially anticipated but sentiment has continued to deteriorate the last few weeks." He said the key levels they are watching are $35,600 to $37,200, "which represents a potential cluster of liquidations if we breach these levels," after which "we'd be looking at support" near $34,000. Kelly said they "can't rule out" a drop to the low $30,000 range, however, "if sentiment continues to deteriorate."

Arca's Dorman, meanwhile, doesn't see a bigger plunge in the cards for Bitcoin: "If anything," he argues, "this has been incredibly overblown" given that risk assets tend to perform well during the early stages of rate hiking cycles. He predicts that broadly, most digital assets will rise this year.

But clearly not all cryptos are the same, and those like Dorman, Hasegawa, and Kelly suggest this year will bring greater dispersion between which coins perform well and which don't. As Dorman wrote in a recent blogpost, 2022 will be an environment "where we have a bear market in some sectors and a bull market in others. A few weeks of high correlation due to market panic does not invalidate sector dispersion and lower longer-term correlations."

Indeed, a lot is happening in certain areas in crypto, like NFTs and gaming and the metaverse, DeFi, and Web3—whereas for Bitcoin, "in the shorter term, there's not much to expect this year," Hasegawa argues. "Solana, Avalanche, those coins will perform well compared to Bitcoin, I think."

But however much pain crypto investors are feeling at the moment, take one look at Twitter and you’ll find a Bitcoin believer or two ready to stick it out.