Asking for 8 digit code to unlock SIMcard and I have a 4 digit code

to use a sim code one provide a 4 diget code

to unlock a locked sim code if one attempted to type in the pin code 3 times wrong one has to type in a PUK code which is 8 didgets

if you want to know more https://itstillworks.com/unlock-puk-code-sim-card-6338200.html

Have a look at Use a SIM PIN for your iPhone or iPad - Apple Support

You might need to contact your carrier.

As already pointed out, if you enter the SIM Unlock code wrong 3 times that particular SIM can only be unlocked by the carrier that issued the SIM card using a master PUK 8-digit code. It looks like that's where you are now.

If you cannot get the PUK code from the carrier that issued the SIM card, you will have to purchase or get them to replace for free that SIM card. Some cellular carriers will replace it for free if you still have the old card, some cellular carriers will charge a nominal fee (like $25) to sell you a replacement SIM card.

To be clear, you do know your SIM unlock code, yes? Did you specifically create a SIM lock code on this SIM card? This could have been done on this iPhone, or on a previous iPhone or Android phone.

Is this a SIM card you have been using in this iPhone for a while with no problems? Or did you recently install it into this iPhone from a previous phone.

Does it let you just enter the 4 digits and hit OK or does it not let you do this?

If you have been using this SIM card for a while, on this iPhone and did not transfer it recently, then it is possible the SIM card is damaged electrically and needs to be replaced.