the proposed equation has new vulnerabilities, someone who places orders for long periods of time and just "waits" for the market will make the most.
Also the recent hardfork did release limit_order_create2 operation which gives everyone the ability to have maximum precision and compete.
OK, how about:
Liquidity points = (sqrt(bid volume * ask volume) * coinage) / duration
where duration is the average time for the bid and ask? That would prevent putting up a set of long term orders away from the market. Though I dont think this is really that big of an issue as it does tie up the funds, which is the goal of using the coinage.
I have proposed what I feel like is a better solution, please give it a read. https://steemit.com/sip/@coinhoarder/steem-proposal-abolishing-liquidity-incentives-and-reverting-the-funds-to-provide-actual-autonomous-liquidity