It's been a tumultuous week for the crypto industry, with the Securities and Exchange Commission (SEC) really starting to crank up the heat. On Monday, the SEC sued the world's largest crypto exchange, Binance, on 13 different charges. Then a day later, it sued the large U.S. crypto exchange Coinbase (COIN 2.09%).

In response to the suit, Coinbase CEO Brian Armstrong tweeted, "We're proud to represent the industry in court to finally get some clarity around crypto rules." The willingness of Armstrong to speak up is nothing new for the outspoken leader, who is battling for crypto's future. 

A different strategy for a different industry

Most times, when a regulator sues a company or issues a big fine or enforcement action, you typically won't see the company at the heart of the case say too much. What they will say will be very guarded and likely have been run through several public relations specialists.

People talking and standing in a conference room.

Image source: Getty Images.

In the world of crypto, CEOs have been more willing to shoot from the hip. Binance founder Changpeng Zhao certainly had plenty to say on Twitter after the SEC sued the exchange. Ripple CEO Brad Garlinghouse has been very vocal regarding the company's ongoing lawsuit with the SEC. And Armstrong has certainly not been quiet in his frustration with the SEC, either.

"Instead of publishing a clear rule book, the SEC has taken a regulation by enforcement approach that is harming America. So if we need to avail ourselves of the courts to get clarity, so be it," he tweeted following the SEC's lawsuit, which alleges that Coinbase has been operating an unregistered exchange, broker, and clearing agency.

There has been an ongoing debate between the SEC and crypto proponents over how cryptocurrencies should be classified. While the SEC argues that many of them are securities and therefore need to be registered and overseen by the SEC, crypto proponents say they should be treated as commodities and overseen by the Commodity Futures Trading Commission.

The SEC had sent Coinbase a Wells notice earlier this year, essentially letting the company know that regulatory action was coming. Both Armstrong and Coinbase's chief legal officer Paul Grewal responded to that notice in a public YouTube video, which is a bit out of the ordinary.

"It's a very poor strategy," former SEC lawyer John Reed Stark recently told The Wall Street Journal. "I was at the SEC for almost 20 years in the enforcement division and worked with every kind of defense attorney, and I never witnessed this before, except sometimes in some really bad penny-stock cases, where the lawyers were in on it."

However, while this is quite unusual indeed, the crypto industry is not your average industry and was really started as a way to give people power outside the government's purview.

Interestingly, crypto investors have often been able to shake off big regulatory events. On the day the SEC announced its lawsuit against Coinbase, cryptocurrencies largely rallied, although they've been volatile this week in general.

A potentially big moment for crypto

Given how erratic the crypto industry is, it's not too big of a surprise to learn that the CEOs of large crypto companies are not your typical, polished Fortune 500 CEOs.

But this is undoubtedly a potentially big moment for the industry. Following the bankruptcy and scandal of FTX, the crypto banks Silvergate Capital and Signature Bank soon went under. It's hard to know exactly what awaits Coinbase and Binance from these lawsuits, which could obviously take a while to play out, but if their ability to operate is impaired, that would obviously be a huge blow to the crypto industry, given how big both exchanges are.

Still, it does seem like lawmakers are trying to put legislation in motion that would achieve some regulatory clarity for the industry, so perhaps these lawsuits are more of a roadblock. Either way, Armstrong certainly will be a big player in the ongoing debate, so his words and actions are likely going to have a very big impact on the future of crypto.