Steam key is unique, acts as is its own platform like PS3 and PS4. You are right now playing your friends steam version if you used his key.

I would imagine he needs to buy HW and give you that key for it to work with this character you linked through steam.

I made the mistake of buying this MMO thru steam as well, never again will I make that mistake. It seems you are in even deeper, as you are playing a game in someone else's steam library from what I understand.