What does "Bitul Torah mean? Am i supposed to spend my life sitting and learning? Also, am i ever allowed to just hang out with friends for the sake of friendship, even if i know that i don’t need a brake from learning and i could very well be sitting and learning then? In summary, would it be better for me to spend my time learning, but not have friends, or hang out with friends instead of learning?

There is no simple answer to the question as you pose it. Learning Torah demands great dedication, but it does not come to the exclusion of other activities. Cultivating friendship is important, as are a wide variety of activities. I would say that the first rule of learning Torah, is that in the time you have to learn Torah, don't waste any. That is, when you are in the Beit Midrash, when you are sitting with a sefer, concentrate fully on what you are doing. There are people who love learning Torah so much that it is natural and proper for them to sit and learn all day. For most people, relaxation and clearing one's mind is needed. A lot depends on age, proclivities, educational framework, motivation, etc. Learn a lot, learn an awful lot, but be a person as well.