How does fread know when the file is over in C?

That's not how you properly read from a file in C.

fread returns a size_t representing the number of elements read successfully.

FILE* file = fopen(filename, "rb");
char buffer[4];

if (file) {
    /* File was opened successfully. */
    
    /* Attempt to read */
    while (fread(buffer, sizeof *buffer, 4, file) == 4) {
        /* byte swap here */
    }

    fclose(file);
}

As you can see, the above code would stop reading as soon as fread extracts anything other than 4 elements.