It would be yes if it's El Salvador as you have said in your post since it is the first country to accept Bitcoin as their legal tender. Op's friend should sell some of his investment up to the amount required. That way, op's friend still have some investment and also have emergency funds. I wonder what this person is doing now after op posted this if he decided to sell portion of his investment or not.

Probably not because the Border Agents or Immigration Staff need to see proof of funds to indicate that your friend has money directly available he can spend to cover his expenses like food and accommodation.

Cryptocurrencies are still too volatile to be accepted as proof of funds, even bitcoin, let alone any altcoin. I think it's still to early for countries to accept this type of proof of funds, probably in the next 10 years things will change but I can understand that embassies are still reluctant to do it, especially because they are the ones issuing the visas.

Globally there are only two nations with Legal Tender status for Bitcoin but so far only El Salvador executed their Legal Tender practically, and you are right, if there is a nation accepts Bitcoin as proof of fund, it's only El Salvador. Who lives in that nation can confirm this information for you because searching result does not give me expected information on Proof of Fund.

https://coinmarketcap.com/legal-tender-countries/

First governments must accept Bitcoin as legal tender before they can accept it as Proof of Fund. It's not popular accepted globally now but in future, with bigger adoption on Bitcoin, I am surely we will have more friendly policies for it in more countries.

That's an interesting subject since I once had a situation where I also had to show funds and got denied when showing crypto, that was in Taiwan applying for some special sort of visa for Japan.
On the other hand, when I applied for another visa for Japan, this time in Hong Kong I witnessed a Philippine applicant that applied for a Japan visa (travel) and actually was allowed to show crypto funds, but they made a special occasion because the person actually made a big scene at the office and I think they didn't want to be bothered by her any longer. 

That's my only experience in this field but I think it's very interesting to know if other people actually made applications for any visa for any country showing crypto funds and got accepted.

I am from Indonesia and the proof of funds for Indonesia visa is not that much $2000, but as far as I know I never heard crypto asset as proof of funds. And to my knowledge, currently, no country will accept Bitcoin as proof of funds for visa applications. Most countries still require more traditional forms of financial evidence, such as bank statements or credit cards, during any type of visa application process. A few immigration departments, such as New Zealand, may be prepared to consider crypto assets if an applicant can prove liquidity and ownership, but this is still very rare and considered on an individual case basis. Traditional fiat-based evidence remains the standard.

https://cointelegraph.com/news/can-crypto-be-used-to-prove-financial-independence-for-travel-visas

So far, El Salvador is the only country that made Bitcoin a legal tender, and even there, Bitcoin does not officially stand in as a substitute for the usual proof of financial stability in visa procedures. Still, if anybody is into residency or citizenship-by-investment programs, the good thing to know is that several countries have started accepting cryptocurrencies as one form of investment against passports.

not that weird, crypto is not a valid payment method. A truckload of new tvs are also worth money, but also cannot be used as a proof of funds (I guess, maybe I am wrong )

just sell it, show the amount of fiat, get approved, and buy it back

This is also the situation in my country. I am not sure if the immigration officers do accept bitcoin as proof of payment but a part of me still feels they wouldn't accept it. It is not just about bitcoin being used as a legal tender in the country, the immigration officers want to know the true state of an applicant through his bank statements. They want to know what goes in and out of the account to be sure the applicant isn't involved in some criminal activities. Bitcoin transactions are not traceable and this might be enough reason for the embassy to request for the traditional proof of funds instead.

Again, due the the unstable nature of Bitcoin's price, how will the embassy be convinced that what the applicant has in his bitcoin account will be enough to sustain him throughout his stay in the country he intends travelling to?

This might just be some of the obvious reasons that will make some countries reject bitcoin as proof funds during Visa application.

In my country, you wouldn't even want to mention that you own or are involved with cryptocurrencies because before your visa gets approved, you will have to have a chat with the authorities and bank officials and any money that you have will get confiscated because it will be suspected of being withdrawn from selling cryptocurrencies which aren't allowed in our country. So as long as you can hide these things, you are good, but as soon as they come to know, you are in trouble.

Banks, especially, and other government institutions in our country are completely against cryptocurrencies and their sale and purchase. The state bank had issued a notice to all banks for now allowing transactions involving cryptocurrencies and those who are involved should get their accounts frozen and their funds confiscated this has happened to a lot of people. Sometimes you get out of it by twisting things here and there and sometimes you don't.