It is not possible to earn $1000 or more using free money. That guy is lying or he might have invested his own money and created the impression with his friends that he is playing with free money.
It is possible if we are talking about possibility, it is proven by some people who could make some money from free money.
I did it once in poker freeroll few years back when there was a promo of a new poker site.
I won the 1st place and I earned 0.25btc (not really remember how much was it worth in fiat)
Of course the chance to win big from free money is so small, but it is still possible if you have the luck.
I do read stories or post here before that are able to earn just from the free plays or welcome offer of some bitcoin gambling maybe before crypto casino gets popular and crypto didn't have many supporters, but now I don't see any sites that are offering free plays with legit value. I mean they can give free spin and some amount but does not correspond into any cryptocurrency, they are more of into familiarisation on the casino or if they have their own altcoins they will give it a few amount but did not give a decent start to really win or earn without depositing any.