I put a random script of almost 400 lines on the clipboard, then I started SQLCMD. At the 1> prompt, I pasted in my block, and it seemed to work. I tested both with the old classic SQLCMD and the newer go-SQLCMD. This was on Windows; it seems from your post that you are on a different operating system. Maybe it is the OS that prevents pasting the way you want it? Or am I misunderstanding what you are trying to do.
In any case, if I would like to run a longer piece of code from SQLCMD, I would rather use the -i option to read it from a file. Or, if I have already started SQLCMD, I would use the :r command.