Generate 8 unique character codes for a big table, Sql Server

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create table YourTable (id int primary key identity(100,1), [UniqueID] varchar(8));

WITH DIGITS AS
(  
    select n 
    from (values (0),(1),(2),(3),(4),(5),(6),(7),(8),(9)) v(n)
),
NUMS AS
(
    select (d5.n*10000 + d4.n*1000 + d3.n*100 + d2.n * 10 + d1.n) as n
    from DIGITS d1
    cross join DIGITS d2
    cross join DIGITS d3
    cross join DIGITS d4
    cross join DIGITS d5
)
INSERT INTO YourTable ([UniqueID])
SELECT null as [UniqueID]
FROM NUMS;

--select count(*) from YourTable;

IF OBJECT_ID('tempdb..#tmpRandoms') IS NOT NULL DROP TABLE #tmpRandoms;
CREATE TABLE #tmpRandoms (
    ID INT PRIMARY KEY IDENTITY(1,1), 
    [UniqueID] varchar(8),
    CONSTRAINT UC_tmpRandoms_UniqueID UNIQUE ([UniqueID])
);

WITH DIGITS AS
(  
    select n 
    from (values (0),(1),(2),(3),(4),(5),(6),(7),(8),(9)) v(n)
),
NUMS AS
(
    select (d5.n*10000 + d4.n*1000 + d3.n*100 + d2.n * 10 + d1.n) as n
    from DIGITS d1
    cross join DIGITS d2
    cross join DIGITS d3
    cross join DIGITS d4
    cross join DIGITS d5
)
INSERT INTO #tmpRandoms ([UniqueID])
SELECT DISTINCT LEFT(REPLACE(REPLACE((select CAST(NEWID() as varbinary(16)), n FOR XML PATH(''), BINARY BASE64),'+',''),'/',''), 8) AS [UniqueID]
FROM NUMS;

select count(*) from #tmpRandoms;

WITH CTE AS
(
    SELECT ROW_NUMBER() OVER (ORDER BY ID) AS RN, [UniqueID]
    FROM YourTable
)
UPDATE t 
SET t.[UniqueID] = tmp.[UniqueID]
FROM CTE t
JOIN #tmpRandoms tmp ON tmp.ID = t.RN;

-- Sample result
select top 10 *
from YourTable;

View schema
Execution time: 4,96 sec, rows selected: 11, rows affected: 300000, absolute service time: 7,6 sec, absolute service time: 7,61 sec