Okay, finally managed to solve it. For future people, here’s the solution:
So when you export your sprite from Photoshop or whatever program you use, you export it with a preferred size (ex. 128×128 px).
What you need to do is, go ahead and click your .png file in Unity. In the inspector window, you will see an option called “Pixels Per Unit”. You have to enter the correct sprite size there.
Apply the changes, and there you go!
CLICK HERE to find out more related problems solutions.