I found the part about them copying data from his phone and iPad more troublesome than the whole bitcoin thing. Why would a self-described "cypherpunk" travel with non-encrypted digital devices, anyway?
Having said that: an unencrypted phone/iPad is actually pretty sensible. You keep all the information you actually want to secure on a server safe at home, and have client software on your devices that can only access it after verifying the user (preferably using two-factor authentication, but even a password would be enough for this purpose)
The U.S. has internet access, so upload everything to the cloud(encrypted) and then sync when you get there, which is what the plan was.
Also having an encrypted device is useless if they can hold you until you open it.
Finally I was talking to someone about this yesterday evening, they had their laptop taken off them for about 10 minutes by the border agents, in that time they installed a rookit on it to track keystrokes.
Really? How certain is he that the keylogger was a recent addition? I have a hard time believing that an ordinary border agent is that technically competent, even if he just had to put in a usb device and select a few menu options.