Implantable assembly components that are biocompatible and highly miniaturized are an important objective for hearing aid development. We introduce a mechanical transducer, which could be suitable as part of a prospective fully-implantable hearing aid. The transducer comprises a sensor and an actuator unit in one housing, located in the joint gap between the middle ear ossicles, the incus and stapes. The setup offers the advantage of a minimally invasive and reversible surgical solution. However, feedback between actuator and sensor due to mechanical coupling limits the available stable gain. We show that the system can be stabilized by digital control algorithms. The transducer is tested both in a finite elements method simulation of the middle ear and a physical model of a human middle ear. First, we characterize the sensor and actuator elements separately. Then, the maximum stable gain (MSG) of the whole transducer is experimentally determined in the middle ear model. With digital feedback control (using a least mean squares algorithm) in place, the total signal gain is greater than 30 dB for frequencies of 1 kHz and above. This shows the potential of the transducer as a high frequency hearing aid.