Moonshot Hunting Guide (Part 3): Way to Find Low Cap Crypto

By now, you know how to spot opportunities in low cap crypto. In Part 1, we talked about the basics and why DYOR matters. In Part 2, we dove into how to vet projects, teams, tokenomics, and on-chain patterns.

Now comes the most important part: Even if you find the perfect moonshot, it means nothing if you get rugged, overexposed, or sell too late. Part 3 is about risk control and portfolio construction. This is what separates lucky gamblers from consistent winners.

🌱 Spotting Red Flags & Scam Patterns

The fastest way to protect your capital is by knowing the scams. Rugpulls haven’t disappeared, they’ve just gotten smarter.

Now let me walk you through the most common rugpull schemes so you can really understand how they work. In fact, there are five major types:

Presale / Fair Launch Dump
Scammers use bots and VPS to fake heavy buy volume on launchpads (eg PinkSale) and push a project into the trending spots to attract real investors. They often clone websites, contracts, and Telegram channels within minutes, then run affiliate campaigns to amplify interest.

After raising funds, they pull part of the money and dump the remaining tokens as soon as trading opens.

On-chain traces exist, but attackers commonly use mixers to hide where the funds end up.

Liquidity Removal Rugpull
Founders create a trading pool by pairing their token with USDT or another stablecoin, then pump the price by buying and selling into their own pool.

If liquidity isn’t locked, developers can remove the pool and take real funds — leaving holders with worthless tokens. Traders sometimes have less than 12 hours (often minutes) to act after a big pump.

This is the most common exit scam.

Always check whether the liquidity is locked and for how long. My recommendation is at least 1 month.

Team / Supply Dump
Many projects keep large blocks of tokens allocated to the team or early backers without clear vesting schedules. When the market cap rises, they distribute tokens across many wallets and sell gradually, creating massive sell pressure that wipes out the price.

Big unlocks or vague vesting are red flags. Only invest when allocations and unlock schedules are clear and a great-fit. Prefer tokens with no scheduled unlocks or very small unlocks - under 30% is ideal.

100% Tax Scam
Some contracts set the sell tax to 99–100% or whitelist only a few wallets that can sell, meaning buyers can’t exit while insiders can. The chart can look healthy because devs manipulate volume, but retail holders are stuck and unable to sell.

You must read the contract on Etherscan/ BscScan to confirm fee settings and owner privileges before buying. If sell fees or owner powers look suspicious, stay away.

Note: Don’t rely on audits or KYC badges. Scammers can still pass them. Even if a project is KYC’d, the IC3 - Internet Crime Complaint Center rarely acts on scams under $100 million, and filing a complaint is far more complicated if you’re outside the U.S. Hence, you gotta check on-chain data to make sure all information is transparent.

Minting New Supply Dump
If the contract still allows minting, developers can create huge amounts of new tokens (2x–3x supply) and dump them into the market to drain liquidity.

Not revoking minter or owner privileges is a critical vulnerability, and a strong sign of potential fraud.

Smithii Tools can make minting extra tokens very easy. Always check the contract for minter roles and confirm whether developers have permission to mint.

🚀 Risk Management for Moonshot Plays

Low cap cryptos are a double-edged sword. They can deliver a 10x, but they can also go straight to zero. That’s why you need clear rules before you buy.

👉 Position Sizing. Never put more than 5–10% of your portfolio into a single low cap crypto. For example, my portfolio is 80% in majors like $BTC.X ( ▼ 0.56% ) , $ETH.X ( ▼ 1.56% ) , $SOL.X ( ▼ 0.89% ) ; 10% in DeFi like $UNI.X ( ▼ 1.27% ) or $CRV.X ( ▲ 3.34% ) ; 5% in Layer 1s; and only 5% in low cap crypto plays.

The Milk Road portfolio is a good reference. It limits big risks, and profits are more stable.

👉 Stop-Loss & Limits. Decide in advance how much pain you can take. A 30–50% drawdown is normal, but anything beyond that is a signal to cut your losses.

👉 Risk/Reward. If you’re chasing a 10x, accept the chance of losing it all. That’s how I treat my 5% allocation to low cap cryptos, either it moons or it goes to zero, but either way, it won’t wreck my portfolio. Having this mindset keeps you grounded and ready.

👉 Without risk management, one bad bet can wipe out months of good decisions.

📊 Building a Diversified Low-Cap Portfolio

Think of your low cap crypto plays like building a mini venture capital portfolio. The reality is simple: out of five projects you pick, most will fail, many will go to zero, and maybe one or two will be the moonshots that change your portfolio forever. The key is that the profits from those winners can cover all the losses, and still leave you with gains across the portfolio.

That’s the math of this game: you’re chasing asymmetric returns, but survival matters just as much.

👉 3–5 Picks. This is the sweet spot for most people. It spreads risk without stretching your attention. Diversification won’t erase risk, but it protects you from the worst-case scenario: a single rugpull or team dump won’t destroy your entire portfolio. The goal isn’t just to find the 50x, but to stay in the game long enough to catch it.

👉 Mix Your Sectors. Don’t fall into the trap of only chasing AI tokens or meme coins. Today’s hype is often tomorrow’s graveyard. Instead, spread across different categories: a few DeFi protocols, some infrastructure plays, maybe a gaming project, and one or two hot narrative tokens. When one sector cools, another could be heating up.

As you can see in the picture, it's not just memecoins that will bring high rewards. There are many other types of assets that can bring almost the same profit but with much less risk, so consider carefully to diversify your portfolio.

👉 Track Progress. The truth is, these “moon” moments often happen in the blink of an eye. Once you’ve added a project to your watchlist, monitor it closely for weeks or months. If it hits your profit target, take action immediately.

Don’t get greedy! Because greed turns winners into losses.

Remember: locking in profits is how you actually survive and thrive in the low cap crypto game.

🔑 Wrapping Up Part 3

So, that’s it. Across this series, we covered:

• Part 1: Basics of low cap crypto hunting and why DYOR is non-negotiable

• Part 2: How to scout and vet projects using tokenomics, teams, and on-chain signals

• Part 3: Risk control, scam avoidance, and smart portfolio building

If you’ve made it here, you already know more than 90% of retail investors chasing low cap cryptos blindly.

The edge isn’t in luck, it’s in process.

So the next time someone drops a “hidden gem” in a Telegram group, you’ll know how to filter hype, protect your capital, and position smartly for real moonshots.