Ah, reminds me of my youth. Very common situation.

The casual sex with friends thing doesn't usually end well. If you want casual sex, make a casual acquaintance who you can call a friend on Friday nights. Talk about what you want, do what you want but, know it's just fun. It's a lot easier not to develop feelings when you're not really friends and if he does, it's a lot easier to make a clean break. (Guys are just as bad as women when it comes to falling for their fb).

Sounds like your feelings for him are getting in the way of the meaningless sex, he lost interest because he didn't want a relationship. If you actually had sex, he risks having to deal with someone who developed feelings that he had sex with or is risking his own feelings, since you guys were at least beginning to be real friends.

And it is casual sex, no relationship intentions.

A good relationship is a friendship with a sexual component.

Doubt his supposed mental illness(es) have anything to do with that mess.

It's time to move on.