This is called Picture in Picture mode. Using it, you can watch video in a floating frame which remains on top of all windows and is available on all the Spaces.
Picture in Picture mode is a macOS feature available on all Macs running macOS Sierra and later. It doesn't require dedicated hardware such as a Touch Bar to function. Touch Bar merely gives a handy shortcut to enter Picture in Picture mode.
If you don't see a Picture-in-Picture button, hold down the Control key and double-click inside the video to open a shortcut menu. Then choose Enter Picture-in-Picture, if available.
This shortcut relies on using both keyboard and mouse.