smtp - Make sendmail require authentication for mail from local domains

Server is running sendmail 8.14

From any machine:

$ telnet mydomain.com 25
HELO mydomain.com
MAIL FROM: 
RCPT TO: 
DATA
this is spam
.

How do I require authentication for any mail that claims to be from a local domain?

This seems like a no-brainer anti-spam feature.

FROM         TO           RESULT
any          non-local    "Relaying denied. Proper authentication required."
non-local    local        success [1]
local        local        success [2]

[1] This is acceptable. Outsiders can send to local users without any kind of authentication. Various DNS checks can be done.

[2] This is the problem. Why should I allow anyone to mail a local user while claiming to be a local user?