According to Catholics, 2 Peter 1:20 is one of many proofs that Christians shouldn't be doing independent Bible study, as we need the Catholic Church to interpret it for us. In the NABRE, a popular Catholic translation, 2 Peter 1:20 reads "Know this first of all, that there is no prophecy of scripture that is a matter of personal interpretation,". This, they claim, means we cannot personally interpret scripture. We must instead go to the Catholic Church.
The first clue to the fact this personal interpretation is wrong is the fact that it is so self-evidently flawed. If I cannot personally interpret scripture, which includes 2 Peter 1:20, then I cannot personally interpret 2 Peter 1:20 to mean I cannot personally interpret 2 Peter 1:20. Thus, such an interpretation is self contradictory, and so is self refuting.
Furthermore, Catholics rarely, if ever, understand what is meant by independent Bible study. No one, other than a few liberals who really do not care what the Bible says, believes you can open the Bible and have it mean anything you want it to. Rather, scripture says what it says, and any two equally diligent and honest Bible students will be able to draw the same interpretations. Of course, just as "Iron is sharpened by iron; one person sharpens another." (Proverbs 27:17). In other words, just as blindly following whatever dogmas your Church vomits upon you is insufficient Bible study, so also is studying it in complete isolation. Christianity is all about community, as we have fellowship with both God and each other. Therefore, we are supposed to help each other out, using scripture, which is "...inspired by God and is useful for teaching, for refutation, for correction, and for training in righteousness, so that one who belongs to God may be competent, equipped for every good work." (2 Timothy 3:16-17). So, let's use it for its explicitly stated purpose and teach the truth to Catholics, refute their flawed interpretation of 2 Peter 1:20, correct their abysmal attitude towards God's word (and, by extension, towards God Himself), and train them in the righteous way to study scripture.
To understand why Catholics are wrong about 2 Peter 1:20, simply extend the scope of reading. Let's start by backing up to verse 16 and go on reading to verse 21: "We did not follow cleverly devised myths when we made known to you the power and coming of our Lord Jesus Christ, but we had been eyewitnesses of his majesty. For he received honor and glory from God the Father when that unique declaration came to him from the majestic glory, “This is my Son, my beloved, with whom I am well pleased.” We ourselves heard this voice come from heaven while we were with him on the holy mountain. Moreover, we possess the prophetic message that is altogether reliable. You will do well to be attentive to it, as to a lamp shining in a dark place, until day dawns and the morning star rises in your hearts. Know this first of all, that there is no prophecy of scripture that is a matter of personal interpretation, for no prophecy ever came through human will; but rather human beings moved by the holy Spirit spoke under the influence of God."
In context, therefore, we see that Peter is not saying "scripture cannot be read by personal interpretation", but rather "scripture does not exist because of personal interpretation". He is defending the veracity of the scriptures, refuting the idea that they are somehow myths and fables, or even the inane ramblings of false prophets. Rather, first of all, Peter and His fellow Apostles witnessed God confirming the legitimacy of Jesus, saying with His own mouth "This is my Son, my beloved, with whom I am well pleased". They didn't just come across Jesus and say "hey, this must be the Son of God!" That would be a private interpretation.
On top of this, Peter says he and the Apostles held a reliable prophetic message. The Holy Spirit, just as He did with previous prophets, moved people to write what He wanted them to write. Neither the prophets nor the Apostles read the signs of their times, like political commentators predicting the outcome of an election. Nor did they even use science, like a weatherman predicting tomorrow's weather. Both of these, even while they can lead to correct predictions, are flawed methods that can occasionally lead to error. But Peter says "we possess the prophetic message that is altogether reliable."
Furthermore, he says "You will do well to be attentive to it, as to a lamp shining in a dark place, until day dawns and the morning star rises in your hearts." But how are we to be attentive to it if we cannot interpret it? If I tell you something awkward like "every dinus day, I swaller a gurglefloof", you're not likely to know what that means, so how can you pay attention to it? But now I'm going to tell you that every Sunday, I drink a coffee. That's useless information to you, but Peter isn't giving useless information. He's literally telling you how to receive eternal life!
Interestingly, even the NABRE confirms this interpretation in the footnotes. Attached to the beginning of verse 20 is footnote I, which reads "1:20–21 Often cited, along with 2 Tm 3:16, on the “inspiration” of scripture or against private interpretation, these verses in context are directed against the false teachers of 2 Pt 2 and clever tales (2 Pt 1:16). The prophetic word in scripture comes admittedly through human beings (2 Pt 1:21), but moved by the holy Spirit, not from their own interpretation, and is a matter of what the author and Spirit intended, not the personal interpretation of false teachers. Instead of under the influence of God, some manuscripts read “holy ones of God.”" (Bold original). In other words, the footnotes in a Catholic translation disconfirm a common Catholic interpretation, instead affirming what "Protestants" say.
It boggles my mind that Catholics are so blind to the irony. If we were to accept their interpretation, logic dictates that we must immediately reject their interpretation, because it is self contradictory. But if we read the verse in its proper context, we see that it is teaching the exact opposite of what they are saying, and even the attached footnote in one of their most popular translations confirms the "Protestant" viewpoint over their own. If Catholics would only give themselves us much credit as we do, embarrassments like this would become far less common. Therefore, let us take the advice Paul gives to Timothy: "Carefully study to present thyself approved unto God, a workman that needeth not to be ashamed, rightly handling the word of truth." (2 Timothy 2:15, DRA).