There are obviously some issues with your friend that he needs to work out. I've seen this happen to a few people (more in their early 20's mind you) where they have to "find themselves". I can't say for sure that this is the issue here but if it is, my experience shows that these people come out of this situation better than wen they went in.
Regardless, I think you have been truly genuine friend up to this point and that may be what he needs. I would say do what you can to be there for him, go see if he's OK.
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