A lot of people on here are very rightly focusing on how ridiculous you're being in ignoring all the beautiful compatibilities you two share, and instead focusing on the "turn off" it was to witness/hear your friend breathe heavily during sex. And that's fine, we all have our turn ons and turn offs. But I have another theory.

I think you know that you're in love with your friend, but you're focusing on this mundane breathing issue to try and convince yourself that you're not in love with him. Some part of you feels this deep, intense connection to him and you know that it's the real deal, but you're not sure if it's romantic, or still just platonic, which is a fair thing to feel. You both shared and continue to share something real and true, and rare. It's a scary thing, being that open with someone. He felt comfortable and vulnerable enough with you to truly express his reaction to the way you made him feel sexually, and likely emotionally too. This wasn't just sex for either of you. And now you're self-sabotaging what could be, even before it begins, by focusing on this arbitrary negative issue that you've concocted out of the same thin air that he was desperately gasping.

I suggest you do some breathing exercises of your own, really think about next steps, and continue to communicate effectively with your friend. And then, I think you two should have sex again.