That's not practical. If you cap velocities, you'll also need to enforce a minimum size for all objects. If you don't do this, it will still be possible for objects to pass through each other. So you can either have really small but really slow objects, or really large but really fast objects.
What most games do is enable continuous collision detection for important fast objects only, like the player or projectiles.
What most games do is enable continuous collision detection for important fast objects only, like the player or projectiles.