How many characters can UTF-8 encode?

Question

If UTF-8 is 8 bits, does it not mean that there can be only maximum of 256 different characters?

The first 128 code points are the same as in ASCII. But it says UTF-

Answer 1

UTF-8 uses 1-4 bytes per character: one byte for ascii characters (the first 128 unicode values are the same as ascii). But that only requires 7 bits. If the highest ("sign") bit is set, this indicates the start of a multi-byte sequence; the number of consecutive high bits set indicates the number of bytes, then a 0, and the remaining bits contribute to the value. For the other bytes, the highest two bits will be 1 and 0 and the remaining 6 bits are for the value.

So a four byte sequence would begin with 11110... (and ... = three bits for the value) then three bytes with 6 bits each for the value, yielding a 21 bit value. 2^21 exceeds the number of unicode characters, so all of unicode can be expressed in UTF8.