What limits central banks from setting highly negative interest rates? What limits central banks from setting highly negative interest rates if needed? Is it only that people can take out a lot of cash and put it in a vault, or are there other reasons?

If we had removed cash and only had electronic money, could central banks set interest rates highly negative, for instance, -10%? Could they set it to -20%? Or would people just have started to use other means of value, like foreign currencies, crypto currencies or gold?
Since this is a question about central banks... they would not want to do this because it would push many ordinary people to put their savings in highly speculative assets, potentially destabilizing the economy. It is/was already a bit of a concern even with near zero, never mind mildly negative interest rates. There's a fine line between "kickstarting the economy" and setting up a large portion of the population to speculate in the junk bond market and/or housing.

Also, wealth inequality will probably go up faster as well (in the long) as more smaller investors get wiped out, although that's seldom a concern for central banks, given their usual mission.

As for hoarding cash in such an environment... that's not without risk either, because the authorities could decide to counter that with some kind of demonetization (see India, and numerous other historical examples.)

Also, in a democracy, weird stuff might happen, like the Swiss left- and right-wing populist parties threatening to put to a referendum a redistribution of the central bank profits into the pension funds (who blame the central bank for their losses.) That would basically negate the effect of the negative interest rates, as far as the pensions funds are concerned. In fact, it would act like a redistribution from others to said pension funds, ultimately.