Monooxygenase that catalyzes an essential reaction in C-terminal alpha-amidation of peptides. Produces an unstable peptidyl(2-hydroxyglycine) intermediate. C-terminal amidation of peptides is required for normal developmental transitions and for biosynthesis of secretory peptides throughout the life. a [peptide]-C-terminal glycine + 2 L-ascorbate + O2 = a [peptide]-C-terminal (2S)-2-hydroxyglycine + H2O + 2 monodehydro-L-ascorbate radical Binds 2 copper ions per subunit. Optimum pH is 5.0. Expressed in the central nervous system (CNS) in a small number of CNS neurons (approximately a few hundred). Expression is present both in cell bodies and within neuropil regions. It is strongly expressed in neuroendocrine neurons (at protein level). Transcriptionally regulated by DIMM. Death as late embryos with morphological defects that resemble those of animals with mutations in genes of the ecdysone-inducible regulatory circuit. Amidated peptides are largely absent but peptide precursors, a nonamidated neuropeptide, nonpeptide transmitters, and other peptide biosynthetic enzymes are detected. Belongs to the copper type II ascorbate-dependent monooxygenase family.