Two hex digits a byte
Hex writes each byte as two digits from 0 to 9 and a to f, where a is 10 and f is 15. H is byte 72, which is 4 × 16 + 8, so 48, and Hi! is 48 69 21. Characters outside plain English take more bytes in UTF-8: é is c3 a9 and € is e2 82 ac.
Pasting hex
The Code box reads hex the ways it is usually written: with or without spaces, with 0x before each byte, or with commas, colons or dashes between bytes, in capitals or not. 0x48 0x69 0x21, 48:69:21 and 486921 all read Hi!. An odd number of digits is marked, as one byte is missing a digit.
Questions
Why does my hex say it is not valid UTF-8 text?
The bytes are not text. Hex is also used for colours, hashes and the contents of files, and those bytes rarely spell valid characters. This page only reads hex that stores text.
Is hex to text the same as hex to ASCII?
For plain English, yes: UTF-8 and ASCII give the same byte for the first 128 characters. UTF-8 also reads the bytes of accented letters and emoji, which ASCII cannot.