Remember you're not his friend, you're his mum. He and his friends don't get to inform you that you're too strict. Their opinion is irrelevant.
Your job is to guide, care for, direct his development, watch for bad influence, help him develop, keep him safe, all those hard things. Keep that front and centre of your mind - that's what you're for.
This kind of behaviour in these pre adolescents is the beginning, the bud. It's where gang behaviour, vandalism, violence etc is born, and by the time they're mid teens, those boys will have escalated if they aren't given the same help you're giving your son.
Remember that children of 10 and older can be arrested for a crime, and will then find themselves being dragged further into that world.
Your actions now will save him from joining them.
He was crying - he's still a little boy. Maybe somewhere in there is relief he doesn't have to do the things they do or try to stop them any more. He shouldn't have to even be doing that because he shouldn't be mixing with them.
Time to assert yourself and facilitate him doing the kind of activities and meeting new friends that won't drag him down.