How can I use the TrackPad's force touch as copy paste function in terminal?
Check out BetterTouchTool. This application will let you customize  actions based on trackpad gestures (including Force Touch).

Here is the action I have defined:



With this setting, I can select text in an application (this works well in Terminal and iTerm), and without explicitly copy/pasting, paste with a 3-finger force-click.