C-peptide is produced when proinsulin is cleaved by proteases, resulting in the formation of insulin and C-peptide. It is stored in secretory granules and released into the bloodstream in equimolar amounts with insulin. Measuring C-peptide is crucial for assessing beta-cell function. Clinical studies have shown that administering C-peptide to type 1 diabetes patients, who lack this peptide, can alleviate diabetes-induced renal and nerve dysfunctions.