Hydrogen functionalization of graphene by exposure to vibrationally excited H₂ molecules is investigated by combined scanning tunneling microscopy, high-resolution electron energy loss spectroscopy, X-ray photoelectron spectroscopy measurements, and density functional theory calculations. The measurements reveal that vibrationally excited H₂ molecules dissociatively adsorb on graphene on Ir(111) resulting in nanopatterned hydrogen functionalization structures. Calculations demonstrate that the presence of the Ir surface below the graphene lowers the H₂ dissociative adsorption barrier and allows for the adsorption reaction at energies well below the dissociation threshold of the H-H bond. The first reacting H₂ molecule must contain considerable vibrational energy to overcome the dissociative adsorption barrier. However, this initial adsorption further activates the surface resulting in reduced barriers for dissociative adsorption of subsequent H₂ molecules. This enables functionalization by H₂ molecules with lower vibrational energy, yielding an avalanche effect for the hydrogenation reaction. These results provide an example of a catalytically active graphene-coated surface and additionally set the stage for a re-interpretation of previous experimental work involving elevated H₂ background gas pressures in the presence of hot filaments.