Beginner here: Question on position sizing for less liquid assets

Hey everyone, been lurking for a bit, great forum. Still finding my feet, mostly trading equities but looking to branch out. One thing I'm struggling with, and maybe it's just my inexperience, is position sizing when dealing with assets that aren't hyper-liquid, like some of the smaller cap cryptos or less traded FX crosses.

With something like $SPY, slippage isn't usually a major concern for the size I'm trading, and my stop loss orders generally execute where I expect them to. But with something like a lesser-known altcoin, or even just certain times of day for $AUDNZD, I've noticed significant spread and execution gaps if I'm trying to exit a position quickly. This obviously makes my planned risk per trade a moving target, and sometimes a very distorted one.

How do more experienced traders here account for potential slippage and wider spreads in their position sizing, especially when a market isn't active, or when dealing with instruments where liquidity can evaporate? Do you just reduce your intended stake significantly, or is there a more systematic approach to adjusting for this kind of execution risk?