Yeah, its normal. Not enough nitrogen (green) most likely. Could also be not enough moisture. A hot pile will often dry from the inside out.

I don't understand the last part of your question.

Okay. So I heard that properly finished compost is supposed to be releasing heat slowly when put in the soil. My question pretty much is how does it do this?

Whoever told you that has their information mixed up a bit. Properly finished compost is not hot. If there is enough nitrogen (greens) in the pile, it will heat up for a period of time, then cool down. That's called the thermophylic stage when rapid decomposition is occurring. Compost should actually not be used when it's hot, as the nutrients have not come to a stable endpoint and you can actually burn plants with it. You should really allow the pile to cool and cure for awhile before using it. If hot compost is added to soil, say in the fall, it will finish curing by spring and won't burn plants.

Even if hot compost were added to the soil it would cool off rapidly since the pile itself is what produces and retains the heat. All that cold soil (which is not chock full of organic matter ready to decompose) will cool it off in no time.

There is a special case where you want heat in the soil, and that's when using it to help a cold frame survive the winter. I've seen this technique described in gardening books - burying fresh manure, laying topsoil on top for plants to grow in, and a cold frame on top of that. The heat of decomposition keeps the space warmer for awhile. Even in that case you don't have the plants right in the manure but in a layer of soil above, so they don't get burned by high nitrogen levels.