Oxidase that catalyzes the conversion of cysteine to 3-oxoalanine on target proteins. 3-oxoalanine modification, which is also named formylglycine (fGly), occurs in the maturation of arylsulfatases and some alkaline phosphatases that use the hydrated form of 3-oxoalanine as a catalytic nucleophile. 2 a thiol + L-cysteinyl-[sulfatase] + O2 = 3-oxo-L-alanyl-[sulfatase] + an organic disulfide + H(+) + H2O + hydrogen sulfide The catalytic copper is required to activate oxygen and catalyze oxidative C-H activation. kcat is 17.3 min(-1) with [sulfatase]-L-cysteine as substrate. Protein modification; sulfatase oxidation. Belongs to the sulfatase-modifying factor family. The disulfide bond observed in the structure does not exist in vivo (PubMed:18390551). The enzyme reaction was initially thought to act via a redox-active disulfide bond mechanism; however the disulfide bond only takes place with inactive enzyme that lacks the copper cofactor (PubMed:25931126). The catalytic copper is required to activate oxygen and catalyze oxidative C-H activation (PubMed:25931126).